Lt James Phipps (left) with Private Andrew Mason close the gates at Bessbrook Mill

The move is a step in Northern Ireland's "normalisation" programme, in response to the IRA's declared end to its activities.

Fewer than 20 members of the Second Battalion Princess of Wales's Royal Regiment vacated the complex at Bessbrook Mill.

Colonel Wayne Harber said it was nostalgic. Sinn Fein MP Conor Murphy said it was welcome in the community.

Operation Banner, the name the Army gave to its support role for the police, will end completely in August after more than 30 years - the longest running operation in British army history.

The last helicopter flight out of Bessbrook took place at the weekend.

Colonel Harber said they were pleased that the peace process was progressing.

"The Army doesn't deal in sentiment but there's a hint of nostalgia and that thread of continuity and the significance that this is the longest military campaign in the army's history," he said.

Army watchtowers have already been taken down in the area

"It is the idea of continuity that we feel today but we are optimistic."

Conor Murphy said: "This is obviously welcome news for the community of South Armagh, who have had to live under British military occupation for the past 30 years.

"Sinn Fein made the issue of demilitarising communities like South Armagh a central part of the political negotiations. We are happy we have now arrived at this point."

UUP deputy leader Danny Kennedy paid tribute to the military for their "huge contribution to peace and the enormous sacrifices they endured".

He said he hoped a lasting memorial would be established in the village "to recognise the service of the many thousands of military personnel who served in the area".

The last soldier killed during the Troubles was based at Bessbrook.

Lance Bombardier Stephen Restorick was shot dead by a long-distance sniper while operating a security checkpoint in 1997. He was the last of 763 military personnel to die in Northern Ireland.

By the summer there will be no more than 5,000 British soldiers in Northern Ireland, based in 11 locations.

At the height of the Troubles there were almost 30,000, based in more than 100 locations.