Aircraft from Canada, Britain and the US had monitored the progress of the giant 330ft-tall balloon across the Atlantic, with air traffic controllers diverting planes from its path.
Last week Canadian jet fighters fired more than 1,000 rounds of cannon shells at the balloon as it drifted eastwards over Newfoundland, but failed to bring it down.
Dale Sommerseldt, Vice- President of Scientific Instrumentation, the company that launched the balloon, told BBC Radio yesterday it had last been spotted west of the Arctic island of Spitsbergen, north of the mainland of Norway.
"It's no longer a threat to Arctic and transatlantic flights, which is a big relief for us," he said. "We believe it's finally down, in the sea, or possibly on pack ice."
The helium-filled balloon was launched last Monday from the western Canadian province of Saskatchewan with the aim of measuring the ozone level over the country.
It was supposed to have come back down two days later, but gained altitude and began to drift across Canada and out over the Atlantic Ocean, creating havoc for air traffic. Commercial aircraft over the North Atlantic then had to be re-routed to avoid an object which was as tall as a 25-storey building.
Fridthor Eydal, of the US Forces in Iceland, said that in spite of its size Canadian aircraft were unable to bring it down by firing shells. They had made some holes, but failed to release all the helium gas.
"It's made of clear plastic," he said. "It would be very hard to shoot down."
The Americans, meanwhile, sent a surveillance airplane from Iceland to track the balloon on radar, but failed to locate it. "The radar they were using was for surface searching," said US Air Force Lieutenant Carla McCarthy