NATO Secretary General Anders Fogh Rasmussen said the alliance agreed Friday to wind down the Libya operation until Oct. 31.
He said Friday following a meeting of the alliance's governing body that the bloc made a preliminary decision to end air operation on Oct. 31, and will make a formal decision next week.
The council took into account the wishes of Libya's new government and of the United Nations, under whose mandate NATO carried out its operations.
After Libya's former rebels killed Gadhafi on Thursday, officials had said they expected the aerial operation to end very soon.
The success of the military operation has helped reinvigorate the Cold War alliance and polished the reputation of France and Britain, the two countries that drove it forward.
Analysts attributed its success to the fact that NATO remained steadfast over the summer during a long and grinding stalemate against Gadhafi loyalists and avoided the temptation to send ground troops into Libya.
NATO earlier said its commanders were not aware that Gadhafi was in a convoy that NATO bombed as it fled Sirte. In a statement Friday, the alliance said an initial Thursday morning strike was aimed at a convoy of approximately 75 armed vehicles leaving Sirte, the Libyan city defended by Gadhafi loyalists. One vehicle was destroyed, which resulted in the convoy's dispersal.
Another jet then engaged approximately 20 vehicles that were driving at great speed toward the south, destroying or damaging about 10 of them.
"We later learned from open sources and allied intelligence that Gadhafi was in the convoy and that the strike likely contributed to his capture," the statement said.
Intelligence gleaned during surveillance flights around Sirte on Thursday indicated that a "command and control group, including senior military leaders" were attempting to flee from the town, Cameron's spokesman Steve Field said.
"There was a strike, there was damage to the convoy, the Free Libya Fighters then moved in -- as to what happened next that is not entirely clear," he said.
Rasmussen hailed the success of the mission, saying that it demonstrated that the alliance continues to play an "indispensable" role in confronting current and future security challenges.
NATO warplanes have flown about 26,000 sorties, including over 9,600 strike missions. They destroyed Libya's air defenses and over 1,000 tanks, vehicles and guns, as well as Gadhafi's command and control networks.
The daily airstrikes finally broke the stalemate that developed after Gadhafi's initial attempts failed to crush the rebellion that broke out in February. In August, the rebels began advancing on Tripoli, with the NATO warplanes providing close air support and destroying any attempts by the defenders to block them.
French President Nicolas Sarkozy said earlier Friday that "the operation has reached its end." But how to draw down the campaign will be decided "with our allies and also with input from the (interim government)."
But in London, Britain had suggested that NATO may not immediately complete its mission in Libya, wary over the potential reprisal attacks by remaining Gadhafi loyalists.
"NATO will now meet to decide when the mission is complete, and once we are satisfied that there is no further threat to the Libyan civilians and the Libyans are content, NATO will then arrange to wind up the operation," British Defense Secretary Philip Hammond told BBC radio.
Sarkozy, Cameron and President Barack Obama discussed the NATO campaign in a video conference late Thursday.
"They discussed the need to maintain the NATO-led operation while a threat remained to civilian life," a spokeswoman for Cameron's office said, on customary condition of anonymity.