The new law -- which the Missouri Legislature declared an emergency act, so it became effective immediately and will be hard to overturn through another public vote -- repeals much of the Proposition B dog-breeding law voters approved in November, but sets new standards for veterinary care and housing, doubling the size of cages by January.
Critics said Republican lawmakers attached an emergency clause to the law to prevent another referendum.
The change was opposed by national animal-welfare groups, but agreed to by Missouri's animal agriculture industry and state-level animal-welfare organizations.
Nixon praised warring groups and rural legislators for "goodwill and hard work" in settling the long-simmering controversy. He said the new law would ensure humane treatment of dogs and preserve Missouri's agricultural interests, the St. Louis Post-Dispatch reported.
Asked what he would tell Proposition B supporters who felt their votes didn't count, Nixon said their votes inspired compromise.
"What I tell them is, but for the action of the public, there wouldn't have been the force that was necessary to coalesce people to make these changes," said the Democratic governor, who worked out the compromise with the Republican-led legislature.
"Their votes did matter," he said.