The proposal would allow grocery stores, fish markets and restaurants to sell legally caught lobsters with a carapace longer than 5 1/4 inches. Only larger lobsters from other states or countries would be allowed.
The state would continue to restrict the capture and landing of those larger lobsters from New York waters.
Lobsters are measured from the rear of the eye socket to rear of the main body shell, or carapace.
The bill "would remove a significant roadblock for New York's restaurants and seafood dealers," said Cuomo, who introduced the measure as a program bill Thursday.
The bill also would formalize the closure of lobster fishing in Long Island Sound annually between Sept. 8 and Nov. 28.
In February, the state Department of Environmental Conservation implemented emergency measures that closed lobster fishing off Long Island's South Shore.
Under the jumbo lobster measure, licensed dealers would be permitted to purchase or sell only properly tagged oversized lobsters that have been legally landed outside of New York waters, Cuomo's office said.
Lobsters taken from New York waters must have a carapace between 3 3/8 inches and 5 1/4 inches.