The news of his death prompted celebrations in the cities of Tripoli and Misrata.
Libya's rebel government said the former dictator was cornered by insurgents in his hometown, then was shot and killed. Gadhafi ruled the north African nation for 42 years until an uprising forced him from power earlier this year.
For many Libyan Americans and nationals in Chicago, the day began with an early morning phone call from loved ones back home. Though many see Gadhafi's death as a step towards democracy, there is apprehension about what lies ahead.
"We've got the business of building a new country, and it's going to be difficult. I think it's going to be more difficult than bringing down Gadafi," said Khalid Smeda, Libyan doctor.
Ibrahim Elfirjani of Orland Park went to Libya in February to join the revolutionary fighters. On Wednesday night, his son was beaming.
"I'm really proud of what he's doing. I'm really proud that I'm his son," said Sanad Elfirjani, son.
Elfirjani, along with other Libyan Americans and nationals sang Libya's national anthem, celebrated with food and fellowship, mourned those who died, and reflected.
"The 42-year dictatorship has ended, bringing joy, happiness and hope to Libyans worldwide," said Sarah Burshan, Libyan American.
Libyan student Nizar Senussi was on the phone all day with relatives back home.
"They are absolutely ecstatic," said Senussi. "I kind of wish I was home. The feeling there is, Chicago is kinda cold today. But the warm feeling I got inside, nothing beats it."
There was also jubilation at the Aduib home in southwest suburban Bridgeview. They have been glued to news reports and hope they will now be able to safely visit loved ones.
"When we were overseas last year, constant fear that we that we just have to hide. We can't speak. We can't say our names out loud. We can't speak to other people we don't know," said Abdulraoof Aduib.
"It is not just for the Libyans. It is for the world at large that this dictator is gone and the democracy and the freedom and the rule of law will be established in Libya," said Mohamed Aduib.
Gadhafi was accused of backing multiple acts of terrorism, including the 1988 bombing of Pan Am flight 103. Among the 270 people killed was Evanston native Bill Mack who worked as a puppeteer for Jim Henson.
"It's not closure, by any means, it's just the end of another chapter in this whole thing. And this thing has had so many chapters over the last 22 years, and I expect there'll be more," said Richard Mack, victim's brother.
Richard Mack once headed the flight 103 victim's group.
"My hope now is that all the evidence that we know is out there that he was the guy that ordered this will now come to light, and we'll actually all get to see that," said Mack.
Though hopes are now high for an open and free Libya, already there are signs of friction between competing factions charged with forming the new government.
"There's a significant risk that what you will see replace the existing regime is one that turns out to be as oppressive," said Tom Mockaitis, DePaul University history professor.
"It's not an easy process, but it's one that is not impossible, and definitely people are up to it. I think the Libyan people are creative, intelligent, passionate, innovative people, and they'll be able to rebuild their nation into what they want it to be," said Ahmed Rehab, Council on American-Islamic Relations.
Gadhafi ruled Libya for nearly two thirds of his life. Some local experts ABC7 spoke with say it could take a year or more for any new government to form. There have already been growing pains with Egypt's transitional government and that very well could be the case with Libya.