A major security operation was launched following the bomb find
Police have said a large bomb left close to the Irish border in south Armagh was intended to kill officers.
The 600lb bomb was made safe by an Army bomb disposal team near Forkhill.
The device had a command wire running from where it was planted in Northern Ireland to a firing point across the border in the Republic.
It is suspected that dissident republicans left the bomb. Police said it could have had a "devastating outcome".
"The actions of terrorist criminals in planting this device in the Forkhill area put local people and police officers at significant risk," Chief Inspector Sam Cordner said.
"Their actions were reckless and dangerous in the extreme. Their target may have been the police, but they did not care who they killed or injured.
Chief Inspector Sam Cordner:
"This was a device planted by reckless criminal terrorists"
"It is only through the hard work and professionalism of police officers and their military colleagues that the area has been made safe."
The BBC's Ireland Correspondent Mark Simpson said the discovery of the bomb was the most serious incident involving dissident republicans since the killing of two British soldiers and a police officer in March.
He said the most "worrying aspect for police" was the size of the bomb and that "even by Northern Ireland's grim standards, 600lb is a big device".
"It shows what the dissidents are capable of producing," he added.
"But at the same time the fact that the attack failed shows they lack the 'expertise' the IRA used to have during the troubles.
"What is more, even in hardline republican areas like south Armagh they lack significant public support. "
He said the question now was what forensic evidence had been left on the bomb.
The remains of the device, which contained fertiliser-based homemade explosives, have been removed for further examination.
The Irish Army and police carried out a similar security operation in the Republic.
The alert in the area began last Tuesday following a telephoned warning to a newspaper.
Sinn Fein MP for Newry and Armagh, Conor Murphy said he was "extremely concerned."
He said: "I would question the motives of those who are putting the local community in such danger.
"I challenge those who have planted this bomb in the community to come forward and explain why they have done so? How is this furthering the struggle for Irish freedom?"
SDLP MLA Dominic Bradley condemned those who planted the bomb and also questioned the police response.
"Everybody accepts the dangerous nature of policing this type of threat by the PSNI, however, serious questions must be asked about the response time in dealing with the device and evacuating people from their nearby homes.
"It seems the PSNI may have known about this bomb days before they moved people and if that's the case then it's certainly cause for much concern."
Resident Marian Hollywood: "They're out to kill me and my neighbours"
"The bomb was found 50 yards from Marian Hollywood's home."
Ulster Unionist deputy leader Danny Kennedy said the attempted attack was "deeply alarming".
"It is likely to assume that members of the PSNI were the target of this bomb; however had it detonated it could have killed any passer by," he said.
"This shows how reckless these republicans were in their targets and highlights their total disregard for human life."
DUP assembly member William Irwin said it was imperative people in the area helped police catch those responsible.
"There is still the very real threat of terrorism here in Northern Ireland and this has been proven once again by the murderous thugs who left this massive bomb near the border," he said.
In January, a 300lb bomb was defused in Castlewellan, County Down.
It is thought the bomb was planted by dissident republicans who were trying to target the Ballykinler army base.
In May the component parts of another fertiliser bomb were found near Rosslea in County Fermanagh.
About 100lbs of explosives were found in a field near the Donagh to Rosslea Road.
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