The abandoned van was one of the biggest ever found in Northern Ireland and was believed to belong to a dissident branch of the Irish Republican Army opposed to the current peace process.
Chief Superintendent Alasdair Robinson told reporters the device was "fully primed and ready for use" and would have caused "significant damage and casualties."
"The device contained two blue barrels with … homemade explosives in each one, and a detonator -- all the equipment which meant this device was ready to go," he said.
The investigation into Thursday's discovery stretched into the weekend; however, suspicions centered on IRA factions seeking to derail the peace process.
CNN said at least two other smaller bombs had been disposed of in Newry, and another device was found Friday night under a parked car in Belfast.