However, on Monday the southern port city was largely calm with Iraqi soldiers the only armed men to be seen on the streets.
"We have control of the towns around Basra and also inside the city. There are no clashes anywhere in Basra. Now we are dismantling roadside bombs," Major-General Mohammed Jawan Huweidi, commander of the Iraqi Army's 14th division, said.
An overnight curfew remains in place in Basra but authorities said that schools would reopen on Tuesday.
People queued outside shops as ordinary Iraqis were able to venture outside their homes for the first time in days.
In Baghdad, the curfew was lifted on Monday morning, although vehicle restrictions remained in place in three predominantly Shia neighbourhoods, including Sadr City.
There were reports of sporadic violence on Monday, including a rocket and mortar attack on the "Green Zone" government and diplomatic compound.
James Bays, Al Jazeera's correspondent in Baghdad, said that although al-Sadr's fighters seemed to be observing his order civilians were nervous that the fighting would flare up again.
Haider al-Asadi, a fighter in Sadr City, said all the Mahdi Army were "now sitting in their homes".
"But we are ready, should the Americans come inside our district, to fight. We have enough IEDs [improvised explosive devices] for them. If they come, we will defend ourselves."
Asadi said that US troops were still on the edge of the neighbourhood and had deployed snipers on the rooftops of houses.Nuri al-Maliki, the Iraqi prime minister who personally supervised the Basra operation, admitted that the crackdown had not been entirely succesful.
In response to al-Sadr's order on Sunday, the government agreed not to pursue those involved in the fighting provided they put away their weapons.
"We came here [to Basra] to pursue criminal gangs and murderers ... our forces were not ready for this battle and we were surprised," he told al-Iraqiya, a state television service.
The deal with al-Sadr meant that his supporters were able to keep hold of their weapons despite the best efforts of government forces to take control of the city.
However, Major General Abdul Aziz, Iraqi commander, said that by Sunday security forces had managed to clear five areas of Basra which were known Mahdi Army strongholds - Al-Najibiyah, Al-Makkal, Al-Ashhar, Al-Zubair and Qarmat Ali.
Jabbar Sabhan, a civil servant in Basra, said he was glad the violence had died down but was doubtful the calm would hold.
"I didn't go to work today. It is true that there are no clashes, gunmen or explosions, but the situation is still dangerous. I don't trust the words of politicians," he said.