ALBANY — New York lawmakers, having fallen short in a push to fully legalize marijuana, have agreed to further decriminalize possession of the drug and automatically expunge many low-level marijuana convictions across the state.

The measure, which would treat possession of up to two ounces of marijuana as a violation instead of a crime, is a significant change in a state in which tens of thousands of residents have been arrested for small-scale possession.

The agreement came after months of negotiations in Albany failed to establish the type of fully legalized industry embraced in nearly a dozen other states, including California, Washington and Alaska.

Still, the measure agreed to on Thursday by the Democrat-led Legislature, and backed by Gov. Andrew M. Cuomo, also a Democrat, was still considered a step forward for those pushing for lessening drug penalties, particularly the expungement of records.

“It was a critical part of the adult-use fight that we put forward,” said Kassandra Frederique, the New York State director of the Drug Policy Alliance, which works to reform drug laws.

The State Senate passed the bill early on Thursday evening, 39-23, and the Assembly was expected to follow suit later that night.

The decriminalization bill was the latest in a flurry of progressive-minded legislation pushed through the statehouse as the closing days of the legislative session dragged beyond its scheduled end on Wednesday. In the last two weeks alone, the recently elected Democratic majority has passed major bills revamping rent regulation, confronting climate change and allowing driver’s licenses for undocumented immigrants.

Earlier on Thursday, Mr. Cuomo — who as recently as 2017 had called marijuana “a gateway drug” — praised the decriminalization bill, saying it would make a difference for many who were ensnared in the criminal justice system as a result of marijuana.

“It does a lot, makes a major change,” Mr. Cuomo said, in a radio interview on WAMC. “It makes the situation much better especially for the black and brown community that has paid such a high price.”

New York decriminalized small amounts of the drug in 1977, up to 25 grams, or nearly an ounce. The new bill will treat possession of less than one ounce as a violation subject to a $50 fine; possession of between one to two ounces, currently a Class B misdemeanor, will become a violation punishable by up to a $200 fine. More than two ounces would still be considered a crime, not a violation. The bill did not change the legal status of smoking marijuana in public, which is still a violation.

Still, it was perhaps symbolic of the nation’s rapidly changing sentiment about marijuana that the failure to fully legalize was considered a defeat of sorts in Albany. More than a dozen states have decriminalized the drug, with more than 30 having medical marijuana programs.

Illinois is poised to become the 11th state to fully legalize marijuana when Gov. J.B. Pritzker, a first-term Democrat, signs a bill recently passed in Springfield.

A study from John Jay College in February found that “blacks and Hispanics consistently had higher rates of arrest for misdemeanor marijuana possession compared to whites.”

In New York City, the Manhattan and Brooklyn district attorneys have stopped prosecuting most people arrested on marijuana offenses, and have taken steps to vacate old marijuana-related warrants and low-level convictions.

Senator Velmanette Montgomery, a Brooklyn Democrat, emphasized the importance of retroactive expungement, even as she called it “half of what we would like to see done.”

In the Senate, almost every Democrat who spoke expressed disappointment that the bill did not fully legalize marijuana, but they praised decriminalization as an important first step.

“I think about individuals I’ve grown up with who have found themselves, I guess you could say, on the wrong side of the law,” said Senator Jamaal Bailey, a Democrat from the Bronx who sponsored the bill and is African-American. “Their lives have been destroyed by marijuana possession that has been effectively legal in certain parts of our city.”

New York legalized medical marijuana in 2014, a strict program which reflected Mr. Cuomo’s hesitancy toward the drug; smoking, for example, is not allowed under the medical program.

“For five years, we’ve had legal marijuana for a certain group of people in our state,” said Senator Diane Savino, who sponsored the bill that helped create the state’s medical marijuana program, “because we recognized — and rightfully so — that marijuana has true value.”

Legislators were also weighing a proposal by Ms. Savino to further expand the medical program, which has been criticized for being overly restrictive.

Republicans, shunted into the minority in both chambers in Albany, voted overwhelmingly against the measure, warning that two ounces of the drug was enough to make dozens of joints.

“This is going to hurt people,” said State Senator Andrew J. Lanza of Staten Island.

Jesse McKinley is The Times’s Albany bureau chief. He was previously the San Francisco bureau chief, and a theater columnist and Broadway reporter for the Culture Desk. @jessemckinley

Vivian Wang is a reporter for the Metro Desk, covering New York State politics in Albany. She was raised in Chicago and graduated from Yale University. @vwang3

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