The roundabout at Place de l'Etoile was closed after police received an anonymous call at 2pm stating there was a suspect parcel in the middle of the Arc de Triomphe.
"The whole area is being evacuated," a source told AFP. "We received an alert around 2.00 p.m. (1200 GMT) and bomb disposal experts are in place already but we still don't know if this was a false alarm or not," the source had said at the time.
The evacuation was expected to cause chaos for commuters as the traffic roundabout is hugely busy and both suburban and subway trains pass underneath it.
However, though the Metro and RER train services that run beneath the famous spot had not been evacuated, bus services in the area were disrupted.
Two hours later, after police had checked the area, the all clear was given and traffic returned to the roundabout.
Bomb scares are fairly regular occurrences at Paris's famous tourist landmarks. In March the Eiffel Tower had to be evacuated after an anonymous caller claimed there was a bomb at the sight.
France has stepped up national security in the wake of its military intervention in Mali, which provoked various unspecified threats of revenge from Islamist extremist groups.