The law also provides for prison terms of up to 10 years for journalists who publish leaked information.
It is the latest in a series of measures which critics say are designed to bolster the power of PM Recep Tayyip Erdogan.
He is accused of introducing the measures to stifle corruption scandals.
The new law extends the ability of secret service agents to conduct foreign operations, tap phone conversations and to access data held by private and public institutions.
Kemal Kilicdaroglu, leader of the main opposition Republican People’s Party, has said the law has effectively turned Turkey into an “intelligence state”.
Recep Tayyip Erdogan has accused police, prosecutors and judges of being behind leaked information implicating him in a corruption scandal.
Earlier this year, recordings surfaced online purportedly of Recep Tayyip Erdogan and his son Bilal discussing how to hide large sums of money.
Another scandal broke when a video on the YouTube website emerged appearing to reveal top officials discussing how to stage an undercover attack inside Syria.
Recep Tayyip Erdogan’s government tried to ban YouTube and Twitter but the move was overturned in the courts, although a ban remained on a handful of YouTube videos in particular.
He has purged hundreds of people from the judiciary and police since several of his allies were arrested over another corruption scandal in December.
Recep Tayyip Erdogan says the recordings are fabricated and has railed against “plots” to undermine him.
Despite the various scandals, his AKP party won more than 45% of the vote at local elections in March.
Recep Tayyip Erdogan has accused US-based cleric and former ally Fethullah Gulen of being behind attempt to topple his government, which Gulen denies.
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