WASHINGTON — More than a year after the financial crisis devastated the economy and triggered massive taxpayer bailouts, the House yesterday narrowly approved the most sweeping overhaul of financial regulations since the Great Depression in hopes of preventing a similar catastrophe.

The sprawling measure grants the government broad new authority to break up large financial firms if their size poses a major risk to the economy, as well as to seize and dismantle such firms if they teeter near bankruptcy. A new $150 billion fund, paid for by the financial industry, would cover the costs of any government takeovers.

Fear that the collapse of giant financial firms could devastate the economy as a whole led to the costly and politically unpopular federal bailout of banks and other institutions deemed "too big to fail." The new provisions are designed to help the government act in a future crisis before such a double-bind develops.

President Obama has made the financial regulatory overhaul one of his top priorities and has prodded Congress to approve the changes before the end of the year. There is strong support by Senate Democrats for toughening regulations.

But with major business and financial groups opposing the legislation and Republicans apparently lined up in solid opposition, the outlook is for another battle royal before a final bill clears Congress. The House passed the legislation 223-202 without a single Republican vote.

"The crisis from which we are still recovering was born not only of failure on Wall Street, but also in Washington," Obama said. "We have a responsibility to learn from it, and to put in place reforms that will promote sound investment, encourage real competition and innovation, and prevent such a crisis from ever happening again."

The nearly 1,300-page bill would create a powerful new agency to protect consumers in the financial marketplace.

And it would make a host of other major changes to federal oversight of the financial system, including imposing new requirements on credit rating agencies, hedge funds and the trading of such complex securities as derivatives.

Business groups were quick to say that the measure could damage the economy.

"Enacting the wrong financial regulatory reforms will have adverse consequences and will be felt throughout every corner of the economy and delay Main Street recovery," said David Hirschmann, president of the Center for Capital Markets Competitiveness at the U.S. Chamber of Commerce, one of the overhaul's most ardent opponents.

Three days of debate in the House were marked by partisan division and finger-pointing over who was to blame for the financial crisis and the bailouts it spawned.

House Democrats said the new regulations would reverse years of lax oversight under President George W. Bush that let Wall Street recklessness shatter the economy. Republicans said the legislation amounted to a federal takeover of the financial services industry and branded the new dissolution fund a permanent pot of bailout money.

One of the most controversial parts of the bill is the creation of a Consumer Financial Protection Agency. It would have the power to write rules for a variety of financial activities involving loans or credit, to monitor large banks for compliance and to ban products and practices it deemed "unfair, deceptive or abusive."

The new agency would remove from the Federal Reserve the ability to write consumer protection rules and strip from banking regulators the authority to monitor financial firms for compliance with those rules.

Consumer and public interest groups strongly support the new agency, citing the failure of regulators to rein in subprime mortgages leading up to the crisis.

Large financial firms have fought aggressively against the new agency, arguing that it would increase the cost of credit and add an unneeded layer of bureaucracy. Some moderate Democrats also opposed creating the agency.

In the end, 27 Democrats voted against the overall legislation.

Another component of the bill is new powers for the government to deal with major financial institutions.

The legislation would prohibit future bailouts to save a company from bankruptcy, as was done with AIG, by granting the government a new "resolution authority" for seizing and dismantling large financial firms.

The $150 billion fund, raised from assessments on large financial firms, also could take out government loans if it were temporarily short of money as long as there is a plan for the industry to repay.

Democrats said the new power would avoid future bailouts. Republicans said the fund was a permanent version of the $700 billion Troubled Asset Relief Program.