The technological breakthrough came as BP finally began an "integrity test" Thursday, 87 days into the crisis, which began with the April 20 blowout that killed 11 workers and sent the burning rig Deepwater Horizon to the bottom of the gulf.
The oil stopped flowing shortly before 2.25 p.m., a BP official said. And a series of cameras some 5,000 feet below the surface clearly showed the halt - a far different scene from the images day after day of a relentless flow.
The move was lauded by officials as a positive step, accompanied by a strong note of caution that the cutoff was simply part of the test, as BP and government experts try to assess how the well is holding up.
"I think it is a positive sign," President Barack Obama said carefully when asked about the oil flow after he made a statement about Wall Street reform's passage in the Senate. "We're still in the testing phase. I'll have more to say about it tomorrow."
Louisiana's Indian American Governor Bobby Jindal said in a statement he was "cautiously optimistic" as the test proceeds.
But, he said, "Work to revitalise our coast won't be done until our waters and our shores are completely clean and our wildlife, our communities and our coastal industries are 100 percent restored."
In the test, BP closed off-one by one-the valves on the cap system through which oil could escape. If at any time the pressure is deemed too low, meaning that oil is escaping through another source in the breached well, the testing would stop.
BP cautioned that the oil cutoff, while welcomed, isn't likely to go beyond 48 hours. Valves are expected to open after that to resume siphoning oil to two ships on the surface, the Q4000 and Helix Producer, as government and BP officials assess the data and decide what to do next.
Two more ships are due to join them in coming weeks, bringing containment capacity to 80,000 barrels of oil a day, more than high-end estimates of how much oil had been leaking.