Luxury jeweller Graff has acquired the 14th largest diamond ever mined - the Peace Diamond - for $6.5m (£4.8m).
The global diamond trading network that handled the auction, the Rapaport Group, said the stone had gone to British billionaire and jeweler, Laurence Graff.
After taxes the government will receive $3.9 million, another $980,454 will go to a community development fund, and about $1 million will go to the workers where the diamond was found earlier in 2017.
Commenting on this gesture, pastor Emmanuel Momo, says: "The Peace Diamond will greatly improve the lives of our people as it will bring clean water, electricity, schools, medical facilities, bridges and roads to our villages and the Kono District".
Officials said they also hoped the sale will help combat the West African country's illicit diamond trade.
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In contrast, the 709-carat rough gem sold in NY will see its proceeds used to improve conditions in the small village where it was found. Schools, hospitals, electricity, clean water and transportation all stand to benefit from the sale, according to the Rapaport Group, which handled the auction. In many cases, groups used slave labor to mine the stones.
Ernest Bai Koroma. The president of Sierra Leone praised Momoh "for not smuggling the diamond out of the country".
It was the government's second attempt to sell the gem after it rejected the highest bid of $7.8 million at an initial auction in the capital Freetown in May.
According to the statement, the Sierra Leone government lost a little more than $500,000 after declining a bid of $7.08 million back in May.