The move, the first time the speed limit has been lowered in the city in 50 years, comes nearly three years after 12-year-old Dashane Santana was struck and killed while trying to cross Delancey and Clinton streets.
"People are sick of hearing these very painful stories of children lost, of seniors lost," said de Blasio, standing near the spot of Dashane's death.
"They don't want to lose their child, they don't want to lose their father or mother...they don't want to take the chance that another life will be lost."
The new speed limit, down from the current 30 mph, will take effect on Nov. 7. The speed limit has been 30 mph since 1964.
Currently, 95 percent of city streets have speed limits at 30 mph or higher. Once the new speed limit takes effect 90 percent of streets will have speed limits of 25 mph or lower.
Advocates and police say the lower speed limit will save lives. Excessive speed is a factor in 25 percent of city roadway deaths and is also the leading cause of motor vehicle crashes.
Reducing the speed of a vehicle to 25 mph from 30 mph doubles the chances that a pedestrian will survive a crash.
That's why Amy Cohen, who lost her 12-year-old son Sammy Cohen Eckstein last year when he was hit by a car across the street from his Park Slope home, said the legislation was urgently needed.
"If the driver had been going 25 miles per hour, Sammy and Dashane would likely still be alive today," said Cohen, one of the lead organizers of Families for Safe Streets, holding up a picture of her son.
"The change to a 25 mile per hour speed limit is a lifesaving change. It is not about raising revenue. It is about saving lives."
The city will spend $500,000 to install 3,000 new speed limit signs over the next year. Access points to highways, the airports and entry points to the city will receive priority.
De Blasio said the city reserves the right to hand out tickets to a vehicle operator traveling even a 1 mph above the speed limit.
"A speed limit is a speed limit. If you go above the speed limit you are liable for a penalty," said the mayor.
But the NYPD's traffic bureau chief Tom Chan said that's not the goal.
"We will not be targeting that individual going 1 mile over the speed limit," he said. "But we will certainly be out there."