The bill by Democratic Sen. Alex Padilla will establish safety and performance regulations to test and operate autonomous vehicles on California's roads and highways.
The governor signed the bill Tuesday afternoon at Google Inc.'s headquarters in Mountain View.
Google has been developing autonomous car technology and lobbying for the regulations.
The company says its fleet of a dozen computer-controlled vehicles has logged more than 300,000 miles of self-driving without an accident. Google's driverless vehicles are mostly Toyota Priuses equipped with self-driving technology.