The Pacific Tsunami Warning Center (PTWC) has completely lifted the tsunami warning for Indonesia and all other areas in the Indian Ocean region.
"A significant tsunami was generated by this earthquake. However, sea level readings now indicate that the threat has diminished or is over for most areas. Therefore the tsunami watch issued by this center is now cancelled," read the bulletin issued by the PTWC.
"The tsunami watch is cancelled for both main shock at 0839Z and aftershock at 1043Z," it added.
The alert has been lifted for all the countries in the Indian Ocean region. Earlier, the center had issued tsunami warnings for 28 countries.
"This bulletin is issued as advice to government agencies. Only national and local government agencies have the authority to make decisions regarding the official state of alert in their area and any actions to be taken in response," said the PTWC.
Earlier, the first tremor with a magnitude of 8.6 generated a wave of around 30 inches (80 centimeters) high but that did not cause any damage.
However, Indonesia has issued fresh tsunami warning after a powerful aftershock of 8.2 magnitudes shook the western coast of the country.
The US Geological Survey put the epicenter of the aftershock at 10 miles (16 kilometers) beneath the ocean around 380 miles (615 kilometers) from the provincial capital, Banda Aceh.
The epicenter of the first quake was at 308 miles southwest of Banda Aceh.
There were scenes of chaos and panic at the streets following the tsunami warning. Thousands of panicked residents fled their homes.
People ran for safety in high grounds in cars and motorcycles. Cries of "God is Great," was heard across the streets, reports said.
In 2004, Aceh was devastated by a tsunami that left 170,000 dead or missing. An estimated 230,000 people in 13 Indian Ocean nations lost their lives in the monster waves.