People who illegally camp on state property now face a Class E felony, punishable by up to six years in prison, instead of a misdemeanor.
Individuals found guilty of a felony in Tennessee also lose the right to vote.
In addition, the law requires that people convicted of aggravated rioting serve a mandatory 45-day sentence, raises the fine for blocking highway access to emergency vehicles, and increases the penatly for aggravated assault against a first responder to a Class C felony.
A Class C felony comes with a $15,000 fine and a mandatory minimum 90-day prison sentence.
After almost two months of sustained protests outside the state Capitol, the bill passed the GOP-lead General Assembly following a three-day special legislative session. Lawmakers also passed bills on COVID-19 liability immunity and telemedicine.
Lee and other Tennessee Republicans have defended the bill, pointing to fires that were set inside and outside a courthouse in May.
“I think what we saw was a courthouse on fire and businesses being broken into and vehicles being damaged. We saw lawlessness that needed to be addressed immediately,” Lee told reporters on Thursday.
That said, Lee has admitted there were portions of the legislation he “would have done differently.”
The move comes on the heels of nearly two months of protests in Nashville sparked by the death of George Floyd, with demonstrators calling for racial justice reforms and a meeting with Lee.
While Lee has declined to meet with them, he has commuted to meet with a handful of Black leaders and has promised to address “racial reconciliation” and other issues.
Hedy Weinberg, the leader of the American Civil Liberties Union of Tennessee, told The Associated Press on Friday that they were "very disappointed" by Lee's decision to enact the law.
"While the governor often speaks about sentencing reform, this bill contradicts those words and wastes valuable taxpayer funds to severely criminalize dissent," she said.