Thousands of people packed on to Victoria Embankment and Waterloo and Westminster Bridges to see in the New Year with fireworks at the London Eye.
"The incredible 700,000 turn out for the New Year fireworks saw Londoners bursting with pride in our city," said Mayor of London Ken Livingstone in his New Year message.
However some spectators were left disappointed as the still air meant that smoke did not clear and views of the £1 million firework display were blocked.
The midnight fireworks display has been an annual fixture since 2003. This year for the first time a 'soundtrack' was broadcast across the area by BBC Radio 1.
Once again images were projected onto the Shell Centre tower – this year's display had an Olympic theme as London prepares to welcome the Olympic torch relay on its way to Beijing.
More than 3,600 police officers were on duty at the event.
"The nature of New Year's Eve in central London has changed," said Supt Andy Tarrant. "From what used to be a relatively low key spontaneous night is now a world-class event that attracts thousands and thousands of people.
"Every year the numbers attending have grown and grown. Such large crowds create a challenging policing environment. Our officers worked hard, alongside the stewards, to keep people safe and ensure they could get home again at the end of the night.
"The atmosphere of the event meant that in the main the crowds were good humoured and there were no major issues reported to police."
120 people were arrested for a range of offences, including public order offences and drunken behaviour. Two men were arrested for possession of an imitation firearm.