Saddam Hussein's power had already been broken but his capture is a hugely important psychological moment for the people of Iraq, the US and British forces occupying the country and the whole Middle East.
It means that Iraq can finally break free of the Saddam era which brought the people not the glory he sought but poverty, oppression and war.
It is also the moment for which the coalition forces had long been waiting and working. It will give them and the Iraqis with whom they are working a surge of renewed confidence in the task of reconstruction.
His capture is the moment coalition forces had been working for
It will also be a blow against the Iraqi resistance, many of whom are reckoned to be former Saddam loyalists.
It is interesting that the US administrator in Iraq Paul Bremer immediately made a point of urging the resistance fighters to lay down their arms and reconcile themselves to the new situation.
This was clearly a deliberate move since the British Prime Minister Tony Blair made the same point.
The US and UK hope is that the capture of Saddam Hussein will be a turning point.
Whether this will break the back of the resistance remains to be seen.
The guerilla war will probably go on in some form at least for a time.
The arrest will certainly boost the positions of President Bush and Prime Minister Blair.
The issue is also what to do with Saddam Hussein now. The Iraqi Governing Council intends to put him and former members of his regime on trial by an Iraqi court.
He could face the death penalty.
Only last week the Governing Council announced that a special tribunal would be set up to try former members of the Baathist regime.
One of the Council's members Ahmed Chalabi said that Saddam Hussein would be brought before the tribunal if he was caught.
The court will be staffed by Iraqis. Judges will be appointed by the Governing Council.
"This court will try cases of genocide, crimes against humanity and war crimes committed from 17 July 1968 (when Saddam took power) until 1 May 2003 ( when he lost power)," said Council member Abdul al-Aziz al-Hakim.
The tribunal will look at the campaign against the Kurds in the 1980's ( including the use of poison gas at Halabje); the suppression of revolts by Kurds and Shias after the first Gulf War; the brutality against the Marsh Arabs; and crimes committed during the wars against Iran and Kuwait.
A spokesman for the Iraqi National Congress, which is represented on the Governing Council, said:
"The Governing Council will take it upon itself to try them and punish them according to law. That includes Saddam Hussein, the biggest criminal."
But some human rights groups say that an international tribunal (and no death penalty) would be preferable.
Kenneth Roth, Executive Director of Human Rights Watch said recently: "An internationally-led tribunal would be a far better option for Iraq, whether a fully international tribunal as the ones established for Rwanda and former Yugoslavia or a mixed national-international tribunal as the one set up for Sierra Leone.
"Because its personnel would be selected by the United Nations rather than by Washington's surrogates, an internationally led tribunal is more likely to be seen as legitimate. And because it can draw from a global pool of talent, it is better able to secure experienced and fair-minded jurists."
Another pressure group, Indict, which has gathered evidence about crimes committed by Saddam Hussein and his henchmen over the years, says that either a trial or a tribunal would be acceptable:
"Saddam Hussein, members of his family and other Iraqi officials committed genocide, war crimes, crimes against humanity and torture. Indict seeks to bring leading members of the former regime to justice in national courts or before an international tribunal," it says.
His spirit hung over the Iraqi people like a ghost in a Shakespeare play
Indict has a fat file full of eyewitness accounts which it is willing to be used as evidence.
A trial is down the road a bit though; of immediate consequence is the impact of his capture.
Cult of personality
It is important to remember the domination of Iraq by this one man over 25 years.
The force of his presence and the brutality of his rule ensured that normal politics vanished while a cult of personality developed and war was waged against his own citizens and against his country's neighbours.
He embarked on a weapons programme which saw him develop chemical and biological agents and which, if left unchecked, would have seen him in possession of a nuclear bomb.
Even though the American-led invasion removed him from command, it did not wholly remove him from influence. His spirit hung over the Iraqi people like a ghost in a Shakespeare play.
Saddam's sons were vulnerable to being given away
His capture was probably only a matter of time. That became clear when his two sons Uday and Qusay were killed in the northern town of Mosul in July.
The only surprising thing is that he has been captured and not killed.
What was significant about the deaths of Uday and Qusay was not just the decision taken by US forces to kill them but the circumstances of their arrival in the villa where they were hiding and of their discovery.
According to neighbours, they simply arrived at the house one day and asked for help. The villa owner, well connected to the Hussein family, let them in.
But later, say reports, someone gave them away in expectation of the rewards offered for them dead or alive - $15m per son.
These events showed that the Hussein sons were not that prepared for a prolonged life on the run and were vulnerable to being given away.
And what was true for the sons was probably true for the father. The reward for him was $25m. He, too, was vulnerable.
He hid for a time but he could not hide for ever.