The Treasury had 234.17 million shares left, or roughly 16% of the insurance giant's outstanding stock.
After unburdening itself from its mountainous holding, the Treasury will only own warrants to purchase additional shares of AIG.
Monday's stock sale announcement follows the department's September sale of about 554 million shares to the public at $32.50 per share. That liquidation marked the end of the Treasury's majority ownership in the firm.
This final stock sale is good news for AIG and its shareholders - and U.S. taxpayers.
"The closing of this transaction will mark the full resolution of America's financial support of AIG-with a profit to taxpayers of $22.7 billion to date. It marks on of the most extraordinary-and what many believed to be the most unlikely turnaround in American business history. And you did it," AIG CEO Robert Benmosche penned in a company email to employees on Tuesday.
After the news, Sterne, Agee & Leach, who give AIG a "Buy" rating, said the sale was good for investors.
"With the U.S. Treasury now out of the stock and AIG once again a 100% privately held company, we expect management will be able to turn its full attention to managing the company to drive improved financial performance and higher return on equity," wrote analysts.