Members voted by 36 votes to three in favour of the ministerial proposal for the holiday to coincide with the royal visit on Monday 15 July.
Concern was expressed by some Members about the cost of the proposed holiday, particularly on small local businesses, those on zero-hours contracts, and islanders with healthcare appointments that might have to be rescheduled.
The cost of paying public staff who would have otherwise worked on the day amounts to £2.5 million – but this is “not an additional cost to the States”.
However, the extra cost for covering shift payments for staff working that day is set to be around £700,000.
This includes backfill, overtime, and time off in lieu.
Chief Minister Lyndon Farnham said he believed “the overall benefits to the island will shine forth” if the holiday was adopted.
The Royal Visit is set to include a special Sitting of the States Assembly and the Royal Court in the Royal Square followed by a large-scale, open-air exposition in the vicinity of Weighbridge Place and Liberation Square that will showcase the best of Jersey.
Full details of the day will be shared in due course.
Guernsey confirmed last week that a public holiday will be held to mark the visit of Their Majesties to the island on the following day, Tuesday 16 July.