The global diamond trading network that handled the auction, the Rapaport Group, said the stone had gone to British billionaire and jeweler, Laurence Graff.
A Christian pastor had given away the more than 709-carat diamond so the government could fund local development projects.
Graff Diamonds won the auction from a field of 70 interested buyers and seven different bids. Named the Peace Diamond, $3.8 million of the proceeds will directly benefit 250,000 inhabitants of a region with no school, hospital, clean water, roads or electricity.
"One hundred percent of the value of this diamond, of the auction sale of this diamond, is going to go to the government and the people of Sierra Leone".
"It is an honor to have acquired this magnificent rough diamond - and that its sale will directly benefit a country in desperate need", Laurence Graff said in the Rapaport release.
The auction on Monday in NY followed several postponements of the event that saw the stone displayed in several European capitals.
A previous attempt to sell it in May did not go through as the Sierra Leone government rejected the highest bid of $7.8 million at an auction in the capital Freetown.
The UN enacted a ban on all diamond exports from the country until 2003, but illicit smuggling continues to mark the modern diamond trade.