Sandy makes landfall in east
It made landfall close to Atlantic City, New Jersey. Much of the city was underwater, and 30,000 residents were evacuated.
Sandy, now a post-tropical cyclone, passed over the New Jersey coast at about 20:00 local time (midnight GMT), packing winds of about 80mph (129km/h).
An estimated 50 million people could be affected, with hundreds of thousands ordered to evacuate homes. More than 1.5 million people have lost power, BBC reported.
Transport has halted in eastern cities, and thousands of flights are grounded.
A record 13ft (4-metre) surge of seawater was measured in New York City, where large parts of lower Manhattan were plunged into darkness by power cuts and there were reports of some subway tunnels flooding.
The storm had earlier killed dozens of people as it passed through the Caribbean, mainly in Haiti.
In the US, it threatens an 800-mile (1,290-km) swathe of coast, from the Atlantic Ocean to the Great Lakes in the Mid-West.
In New York, some 375,000 residents were ordered out of lower Manhattan and other areas, as the Hudson and East rivers began overflowing their banks.
One man in the New York borough of Queens was killed when a tree fell on his home, firefighters said.
A spokesman for the city's main utility provider said some 250,000 customers in Manhattan had been left without power.
Trading on the New York Stock Exchange and Nasdaq will stay suspended for a second day on Tuesday. The United Nations headquarters in New York has also been closed.
Both President Barack Obama and Republican challenger Mitt Romney cancelled campaign appearances little more than a week before the presidential election.
In Washington DC, federal government offices were to be closed until Wednesday.
Public transport was suspended in the US capital, New York, Baltimore, Philadelphia and Boston.
Amtrak has suspended passenger train services across the north-east, while nearly 14,000 flights were cancelled, according to Flightaware.com.
Forecasters say Sandy could linger over as many as 12 states for 24-36 hours.
Up to 3ft (91cm) of snow is expected to fall on the Appalachian mountains in West Virginia, Virginia and Kentucky.