Papua New Guinea Prime Minister Peter O'Neill says an attempted mutiny in Port Moresby by up to 20 soldiers has been put down.
The soldiers said they had taken control of the country's military HQ, and demanded the reinstatement of ousted PM Sir Michael Somare.
But Mr O'Neill said that defence chief Brig Gen Francis Agwi, who was arrested during the mutiny, was now free.
He told ABC News lead mutineer Colonel Yaura Sasa was being "dealt with".
However, he declined to explain what that would entail.
He told the Australian broadcaster: "The government has now taken control... The commander is now released, he's not under house arrest. And, as a result, the government has taken full control of the defence headquarters.
"We will now start an investigation into the issues that the soldiers have, and we'll resolve them as we move forward."
The incident appeared to be linked to the conflict between Mr O'Neill and Sir Michael - the two men claiming the role of prime minister.
The two men have been wrangling over the leadership role for six months.
Col Sasa, a former defence attache to Indonesia, backs Sir Michael and had earlier called for him to be reinstated as prime minister within seven days.
He declared himself commander after placing Gen Agwi, who backs Mr O'Neill, under house arrest. Col Sasa denied staging a mutiny, and said that he had been appointed by Sir Michael's government.
The incident is the latest conflict in a power tussle between the two men claiming the South Pacific nation's top job.
Sir Michael left Papua New Guinea in March to receive treatment for a heart condition. In June, his family announced he was standing down from politics, a move he later said had been taken without consulting him.
He remained out of the country for five months and in August, MPs declared the position vacant and that Sir Michael was no longer an MP. Mr O'Neill was elected by 70 votes to 24, replacing acting Prime Minister Sam Abal.
A Supreme Court ruling in December 2011 then stated that parliament had acted illegally by electing Mr O'Neill prime minister. The court also ruled in a 3-2 decision that Sir Michael should be ''restored to the office of prime minister''.
Mr O'Neill, who is backed by the civil service and effectively running the country, refused to step down.