Until now, MPs only faced an open re-selection contest if 50% of a constituency’s local branches and affiliated unions voted for it.
But delegates at the party’s annual conference in Liverpool backed a proposal for that threshold to be reduced to 33%.
A total of 65% of members and unions backed the move, with 34% voting against.
Opponents say this is part of an effort to purge “Blairites” and other critics of leader Jeremy Corbyn from the party, while supporters of the change say it will help a new generation of Labour MPs emerge.
Wendy Nichols, a National Executive Committee member who chaired the debate on Monday morning, appealed for delegates not to boo when the results were revealed.
There was heckling after a separate vote on Sunday.
“It’s a democratic party,” she said.
“The results are done by us all so please refrain from booing today.”
Several members expressed their discontent with the move, suggesting it did not go far enough.
Many within the party support mandatory open selection contests for all MPs ahead of every election.
Deputy leader Tom Watson told Sky News ahead of the vote that mandatory re-selection would be “very destabilising for the party”.
“We are potentially close to a general election, maybe any day,” he said.
“What we don’t want is MPs having to defend their positions in their local areas when they could be campaigning in parliament for social policy that affects the many, not the few.”
Delegates also backed changes to the rules covering leadership elections.
While the 10% threshold for the number of nominations from fellow MPs a candidate must secure to get on the ballot paper has not changed, they must now also secure nominations from 5% of constituency parties or 5% of trade union members or affiliated organisations.
A spokesman for Momentum, the left-wing activist group supportive of Mr Corbyn, said: “While the Democracy Review has passed it is only a meagre set of reforms, falling well short of what the members want with many key proposals being watered down or blocked.
“However, it could have been much worse.”
The group said it had helped deliver a “crucial reform” of the system for selecting parliamentary candidates and “averted catastrophe” over the leadership threshold.
The spokesman added: “Although it stops short of open selections, the changes to how parliamentary candidates are selected will give members far more say in who represents them and help open the door to a new generation of MPs.
“And while the change in the leadership rules is deeply disappointing, it is not the dramatic increase to the leadership threshold proposed earlier in the week which would have stopped a socialist candidate getting on the ballot in a future leadership contest.”