The Prime Minister on Thursday urged people to "come back into the capital" following claims that the 2012 Games had turned London into a "ghost town", with commuters and non-Olympic tourists avoiding the city.
David Cameron said the "threat of meltdown on the traffic system" had been defeated, and that London and all it has to offer was "open for business" during the sporting events.
He told Sky News: "People said also that London wouldn't cope, the traffic would grind to a halt, the capital city wouldn't manage, that hasn't been the case either. I think the authorities have done a good job.
"Clearly there is a challenge now though to say to Londoners, to the British public who've helped us to, as it were, defeat the threat of meltdown on the traffic system, to say to them now actually there is a case, London's working well, it's open for business, come back into the capital, come and shop, come and eat in London's restaurants and let's make sure that all of London's economy benefits from this."
Cameron praised the organisation of the Olympics, amid the "challenges" of the opening days and underlined the Games' role as a platform to do business.
He added: "I chaired the Olympic Cobra again this morning where we go through all the challenges, the problems of the empty seats, the challenge of getting people into London, the challenges of maintaining security, how much we need the army...we go through those challenges everyday to try and make sure we're getting everything right at the Games.
"Now it's still big challenges to overcome, but the country I think is enjoying these Games, they're very well put on, we're getting a lot of praise internationally for how they're being done and my interest is we're also winning some big deals.
"I want to get business here, I want to get investors here and we've had some big successes. Warner Bros for instance have said they are going to make their next big Tom Cruise movie right here in Britain."
Culture Secretary Jeremy Hunt said having the Olympic Games in London was "the best possible gift you could ask for" if you run a tourism business and insisted people needed to adopt a long term view.
After figures showed that footfall in the theatreland and shopping focal point of the West End was down almost 5% and Mayor Boris Johnson admitted that the Games were having a "patchy" effect on some businesses, Hunt told ITV's Daybreak that the Olympics had given the city a global "cachet" that would boost long-term tourism.
"I think we have to take a slightly longer-term view on this - if you have a business in London, particularly a tourism business - a theatre or restaurant or hotel - then having the Olympics in London is the best possible gift you could ask for because that has given London a profile on a global stage," he said.
He added: "We have a plan to get four million additional tourists here over the next four years. It may be a bit up and down over the next few weeks but it is going to be terrific for London businesses."
Transport for London has abandoned recorded warnings from Mr Johnson about expected congestion, blamed by some businesses for scaring people away from the city centre.
Figures from Experian suggested that footfall was down 9.6% in east London stores and 4.53% in the West End compared to last year on Monday and Tuesday this week.
The Licensed Taxi Drivers Association said cab drivers had been hit hard, with business down by around 20%-40%.
Hunt also said Locog had already managed to claim almost 7,000 tickets for unfilled corporate seats back from organisations linked with the Games.
A total of 3,000 tickets were clawed back and sold online on Monday this week and a further 3,800 the following day, he said.
Johnson rejected suggestions that the Olympics had turned London into a ghost town, empty of shoppers and theatre-goers.
He said: "I don't think we should necessarily accept that. If you look at what's happened around the venues, they are all rammed with people."
"And hotels, for instance, have twice as much occupancy as any previous Olympic city."
Speaking after the daily ministerial Olympics meeting in Whitehall, Mr Johnson added: "What we have done, really, is won round one in the great battle to put on a successful Olympics.
"We have got the transport moving, we have all the athletes to venues on time.
"The media, if I may respectfully say, were in the lead in drumming up hysteria, gloom and terror about the possibility of various things going wrong, not least transport. It hasn't gone wrong. We are putting on a very good Games indeed."