The main impact of that US involvement had on domestic policies was on the laws that had to do with free speech.
During the war, the US government felt that it was very important that all Americans should be in favor of the war and should support the government's efforts to fight the war. Because of this, they passed laws (notably the Sedition Act) which made it illegal to do or say anything that might hinder the war effort. It was under this law that Eugene Debs was sentenced to 10 years in prison for a speech in which he encouraged people to resist the draft.
President Woodrow Wilson instituted policies specific to WWI during his time in office. Among them were:
1) The Espionage Act of 1917, and later, the Sedition Act of 1918, made it illegal to dodge the draft, to aid an enemy nation during the war, and to interfere in any way with American and Allied war efforts.
2) Special agencies were established only for the purposes of the war effort:
a) In 1917, The War Industries Board was established under the leadership of Bernard Baruch, a wealthy stock market investor in New York. This board was responsible for coordinating industrial production during much of the war.
b) The Food Administration was established under the leadership of Herbert Hoover, later the 31st President of the United States. The Food Administration promoted Meatless Mondays, war gardens, and Wheatless Wednesdays to help conserve food for the war effort. Hoover's greatest achievement was in leveraging the efforts of American farmers to streamline and expand the production of food. As a result of Hoover's efforts, America produced enough food for the civilian, as well as military populations of the United States. Additionally, America supplied the majority of the food to European allies.
c) The Fuel Administration was established to conserve energy; one of its most notable efforts was the institution of daylight savings time.
d) Nearly twenty four million men were drafted and registered for the war effort based on the Selective Service Act of 1917. The Selective Service Act required all men aged 18-45 to register at local polling stations. Wilson's Act allowed the United States armed forces to match the numbers of those in Axis armies.
e) Unions promised that its worker members would not go on strike during the war. Therefore, the labor system achieved nearly full employment and good wages during this period.
f) The United States' antiquated railway system was nationalized for the duration of the war in order to facilitate the efficiency of moving men and weapons for battle.
g) The Committee Of Public Information was created by Wilson to mobilize public support for the war and to manage war rhetoric in the United States. The Committee was headed by George Creel, a journalist.
3) Private Organizations worked with government agencies to aid in the war effort. The American Protective League was one such organization. The League worked hand in hand with the Justice Department's Bureau of Investigation to root out spies and war saboteurs. However, the League suffered from very specific challenges: overzealous private citizens often overstepped authoritative boundaries, and attributed to themselves powers normally reserved for CIA (Central Intelligence Agency) officers.