The bill, approved 13-8 by the Health, Education, Labor and Pensions Committee, would require the Food and Drug Administration to restrict tobacco advertising, regulate warning labels and remove hazardous ingredients.
The agency also would be given the authority to set standards for products that tobacco companies advertise as "reduced risk" products.
"There are close to 70 known cancer-causing agents in tobacco products, Matt Myers, president of the Campaign for Tobacco-Free Kids, told CBS News correspondent Nancy Cordes. "Today no one has the authority to tell a tobacco company to take any of them out."
"This is an enormous step forward," said Myers. "This could end up being the signature public health action this Congress takes."
The bill has broad bipartisan support in the Senate, where more than 50 senators have signed on as co-sponsors. A similar bill passed the chamber in 2004 but was blocked in the House.
The tobacco legislation was crafted through several years of negotiations led by Sen. Edward Kennedy, D-Mass., involving health groups and tobacco giant Philip Morris, which broke from its competitors to endorse FDA regulation.
The bill would allow the FDA to reduce the amount of nicotine in cigarettes, but only Congress could permanently ban them.
Misleading terms like "light," "mild" or "low tar" would also have to be eliminated, reports Cordes.
The committee adopted an amendment by Sen. Mike Enzi, R-Wyo., that would ban clove cigarettes, reversing a controversial decision by Kennedy to allow the FDA to make that decision.
Kennedy, the panel's chairman, said he was responding to several senators who contacted him with concerns that a ban on cloves would not be compliant with World Trade Organization rules. But Kennedy agreed to the ban after several senators objected.
Most cloves are marketed in Asia, and Philip Morris, a unit of New York-based Altria Group Inc., recently launched a Marlboro cigarette flavored with cloves in Indonesia.
Kennedy said at the meeting that Philip Morris had "nothing to do with our decision" and he supported the clove ban as long as it is WTO compliant.
Phillip Morris argues the bill would "bring predictability and clear standards to the tobacco industry," an industry that over the past decade has been besieged by lawsuits and public resentment, reports Cordes.
Philip Morris' competitors are strongly opposed to the overall bill, saying it would lock in Philip Morris's dominant market share. The panel rejected several amendments by Republican Sen. Richard Burr, who represents R.J. Reynolds Tobacco Co. in his home state of North Carolina. Kennedy said Burr's amendments would undermine the legislation.
After the hearing, Burr said he would not rule out trying to hold up the bill on the Senate floor.
Enzi, the top Republican on the panel, also opposes the legislation and has objected to Philip Morris' involvement.
"If this bill is good for big tobacco, how can it be good for public health?" Enzi asked after the hearing. "The fact is, it can't. This bill is nothing more than a 'Marlboro Protection Act,' written to keep Philip Morris at the top of the tobacco market."
Enzi has introduced his own bill that would aim to greatly shrink the size of the tobacco market over the next 20 years.