Apps will have to be developed, cab drivers will optionally be able to participate.
The rule change could mean that petty annoyances such as getting soaked while hailing a cab in the rain and having cabs grabbed by more aggressive passengers could be things of the past.
Currently, yellow cabs can pick up only riders who flag them down on the street. New York does not allow its fleet of some 13,000 yellow cabs to arrange pickups with passengers, although livery cabs and car and limousine services can do so.
Many details of how e-hailing will work in New York will be left up to developers of applications for smartphones.
Under the change, riders will be able to connect with taxis within a half-mile radius in Manhattan south of Central Park and within a 1.5-mile radius elsewhere in the city.