The city’s improved levee system helped avert a disaster like Hurricane Katrina, which flooded most of the city, and officials were also aided by a disorganised and weakened Gustav.
Eight deaths were attributed to the storm in the US after it killed at least 94 people across the Caribbean.
But New Orleans was still a city that took a glancing blow from a hurricane: a mandatory evacuation order and curfew remained in effect.
Electric crews started work on restoring power to the nearly 80,000 homes and businesses in New Orleans — and more than one million in the region — that remained without power after the storm damaged transmission lines that snapped like rubber bands in the wind.
“We have a massive caravan of crews coming to the city and they should be here this morning to fix the rest of the power outages,” Nagin said.
The city’s sewer system was damaged, and hospitals were working with skeleton crews on backup power.
Drinking water continued to flow in the city and the pumps that keep it dry never shut down — two service failings that contributed to Katrina’s toll.
Gustav was downgraded to a tropical depression, and mandatory evacuation orders were lifted for three south-east Texas counties.
The storm’s maximum sustained winds decreased to near 56kmph as it puttered toward northern Louisiana and east Texas.
Nagin cautioned that yesterday would be too early for residents to return, but said their homecoming was “days away, not weeks”.
The state took pride in a massive evacuation effort that succeeded in urging people to leave — almost two million left coastal Louisiana.
But, in shelters, people far away from their homes were growing restless. Fights broke out at a shelter in Shreveport.
Doctors also worried about medications running out and seven people were taken to hospital.
Meanwhile, Hurricane Hanna slumped to tropical storm strength while grinding away at the Bahamas and other Atlantic islands and forecasters said it still poses a threat to the US east coast.
The storm snapped trees and hurled rains that caused flooding across Cuba, Haiti and Puerto Rico, where at least one person died. Hanna has the potential to become a hurricane again by tomorrow.