The legislation in Carinthia requires plans for any building of "extraordinary architecture or size" to be approved by a commission to judge its compatibility with the standard look of towns, meaning mosques would stand little chance of permits.
"We are really the pioneers on this and I can only recommend to all to have the courage to stand up effectively against this Islamisation that is creeping through Europe and represents a totally different culture," Haider said on Austrian television on Tuesday.
In a statement, the government said Haider's rightist Alliance for the Future of Austria party had won approval for
the bill from mainstream conservatives, who are part of Austria's national government led by Social Democrats.
Carinthia's Social Democrats, who opposed the law, called it a populist stunt because no one had ever requested permission to build a mosque in the overwhelmingly Roman Catholic province.
"We are creating a law for something that doesn't exist," provincial Social Democratic leader Gaby Schaunig said.
Omar Al-Rawi, spokesman for Austria's Islamic community, said the legislation violated principles of equality and
religious freedom and put Austria's reputation on the line.
Immmigration from the Islamic world has surged in Austria since the 1990s. But Carinthia has the second-lowest share of Muslims among all Austrian provinces, about 11,000 out of an estimated 400,000 population, community officials say.
Haider became known internationally in the 1990s with remarks seen as xenophobic and playing down Nazi war crimes, as the rightist Freedom Party he then led rose to become the second biggest in Austria.
After an internecine power struggle, Haider broke away from the Freedom Party and founded the Alliance in 2005. But his new party's national impact has been negligible since he decided to focus on his home region of Carinthia.