From November 4, the newspaper will drop its newsstand price to 25 cents, half the current price, and increase the pages and widen its distribution.
In a statement, William Kummel, the paper's chief operating officer, said: "Readers can pick up a copy of the New York Sun and a copy of the [New York] Times and hand over a dollar."
The paper has changed its front cover to include a new slogan: "Expect a different point of view". The New York Times reads "Expect the world".
It has increased its distributed among 5,000 outlets in New York's surrounding suburbs such as northern New Jersey, Long Island and Westchester County.
The New York Sun was launched by SL LLC, a company established by former Wall Street Journal editor Seth Lipsky and managing editor Ira Stoll, and is backed by a group of investors including Lord Black.
It said at the time it would provide readers with priority coverage over New York City, which it claimed had been absent since the Times became a national title.
Kummell said the paper is on schedule to hit its circulation target of between 25,000 and 30,000.
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