New York City's ubiquitous public transit system shut down ahead of Sandy's landfall, leaving iconic sites such as Grand Central Terminal and Penn Station empty.
The city expects a slow surge of water to flood low-lying areas such as Queens, the Bronx and Battery Park in Manhattan, Mayor Michael Bloomberg said.
Mandatory evacuations are in place for parts of New York City. Evacuation centers have been opened in 76 locations, and schools in the city are closed Monday.
Offices at United Nations headquarters in Manhattan also will be closed Monday, as will the physical trading floor of the New York Stock Exchange. Operations will continue on the company's electronic exchange.
The Broadway League canceled all Broadway performances Monday night, citing the suspension of public transportation.
Instead of tourists and theater fans, piles of sandbags lined Broadway.
Gov. Andrew Cuomo directed Army and Air National Guard members to mobilize for Sandy, and Obama has declared a state of emergency for New York.
Strong winds and rain that fell sideways lashed the Outer Banks as the outskirts of Sandy pummeled the barrier islands.
Forecast expect between 4 and 7 inches of rain to fall over several days in the Outer Banks, with some spots receiving 8 or more inches.
Gov. Tom Corbett declared a statewide disaster emergency ahead of the storm, Corbett's office said.
Flooding, power outages and sustained high winds are anticipated, his office said. Sandy could even bring snow to parts of southwestern Pennsylvania and in higher elevations.
"Essentially, this is a hurricane wrapped in a nor'easter," Corbett said.
Public schools in Philadelphia will be closed on Monday.
Public transportation in the Philadelphia area has been suspended.
The Rhode Island Emergency Management Agency urged all residents to prepare for prolonged power outages, wind damage and water damage by keeping an emergency kit, securing property and taking boats out of the water.
State authorities have taken precautions such as checking and clearing drains in flood-prone areas and relocating state equipment if necessary.