The 1982 "Untitled" of a skull-like head in oil-stick, acrylic and spray paint on a giant canvas was the star lot of the auction season this May, which wraps on Friday with more than $1bn in sales.
Sotheby's said it was snapped up by the same Japanese entrepreneur, 41-year-old Yusaku Maezawa, who set the previous Jean-Michel Basquiat auction record last year, dropping $57.3m on a self-portrait.
The $110.5m price tag was a record price for any US artist at auction and the highest price at auction for an artwork created after 1980, Sotheby's said.
Cheers and applause greeted the sale, which almost doubled the previous Basquiat auction record of $57 million. During bidding, the auctioneer offered occasional moments of levity and encouragement.
"It's a great masterpiece at $98m dollars," he said to laughter in the room. The $110.5m price tag includes the buyer's premium.
Basquiat, born in Brooklyn to Haitian and Puerto Rican parents died in 1988 of an overdose aged just 27 after a fleeting eight-year career.
"Untitled" provoked a tense 10-minute bidding war in the room and on the telephone, before ultimately going to Maezawa via telephone.
The canvas had been virtually unseen in public since being bought in 1984 for $19 000. It was valued pre-sale in excess of $60m.
Sotheby's announced that the painting will be housed eventually in a museum based in Maezawa's hometown of Chiba, Japan.
Sotheby's parted with a total of $319m worth of post-war and contemporary art at Thursday's evening auction, one day after rival Christie's sold $448m at its own version of the same sale.
The subject of much of Basquiat's work - ordeals endured by blacks in America - is finding renewed resonance in the wake of nationwide US protests since 2014 about the shootings of unarmed black men by police.
Christie's sold Basquiat's "La Hara" - an acrylic and oil-stick of an angry-looking New York police officer - for $35m on Wednesday.
"Breaking $100m for a work which is that recent is definitely extraordinary.
I think it just speaks about the talent of this guy," said Gregoire Billault, Sotheby's head of contemporary art.
"I've never seen so much emotions in such a painting," he said. "It's just pure emotion. He's bringing something never seen before."
Sotheby's also sold Roy Lichtenstein's "Nude Sunbathing" on Thursday for $24m, which like many lots made its auction debut.
The sale also broke a string of records for lesser known artists - Keith Haring, Blinky Palermo, Mira Schendel, Wolfgang Tillmans, Jonas Wood and Takeo Yamaguchi.
Christie's announced that its impressionist, modern, post-war and contemporary sales this week totalled $842.5m, which it said was a $220m increase over its sales last season in November.
Sotheby's concludes its week of sales on Friday.
This season saw an emphasis on art being offered for the first time. Christie's said more than 80% of its lots were coming to the market fresh or for the first time in 20 years or more.
Sotheby's said 65% of works in Thursday's sale made their auction debut and nearly 75% for the first time in 20 years.
Both auction houses saw competitive bidding from around the world.
Pablo Picasso holds the world record for the most expensive piece of art ever sold at auction. His "The Women of Algiers (Version 0)" fetched $179.4m at Christie's in New York in 2015.