It was the decision pretty much everyone expected, although in Ecuador not everybody will approve.
The Ecuadorean government said it had granted Mr Assange asylum because it shared his fears of political persecution and the possible consequences of an eventual extradition to the United States.
"There are serious indications of retaliation from the country or countries that produced the information published by Mr Assange; retaliation that could endanger his safety, integrity and even his life," said the Minister of Foreign Affairs, Ricardo Patino.
"The evidence shows that if Mr Assange is extradited to the United States, he wouldn't have a fair trial.
"It is not at all improbable he could be subjected to cruel and degrading treatment and sentenced to life imprisonment or even capital punishment," he added.
Most supporters of the Wikileaks founder share this belief.
And Mr Assange knew he could count Ecuadorean President Rafael Correa among those supporters, even before he walked into the Ecuadorean embassy in London.
But according to Santiago Basabe, a professor at the Latin American Faculty of Social Sciences, Mr Correa's reasons go beyond his declared interest in protecting Mr Assange's rights.
"It is important to understand that this event was the conclusion of a very long negotiation between Mr Assange and the Ecuadorean government," he said.
"Many see Mr Assange as somebody who has fought for freedom of speech and freedom of opinion, which are also key components of the Ecuadorean government official discourse.
"By granting him asylum, the government was trying to prove it really cares about freedom of opinion and freedom of the press, at a moment when Ecuador has been strongly criticised, both nationally and internationally, for the way the national government understands democracy," Prof Basabe added.
In Ecuador, however, not everybody is convinced the country's international image will be better off as a result.
The private media and a large majority of opinion makers - traditionally opposed to President Correa - warned that Ecuador had very little to win from a positive response to Mr Assange's request.
For instance, Ecuador has been trying to secure a commercial agreement with the European Union and many fear that picking a fight with the United Kingdom and Sweden will not help.
And they will certainly try to use the whole issue against Mr Correa as he seeks re-election in February 2013.
Former President Lucio Gutierrez has even suggested that Mr Correa's real intention is to use Mr Assange's hacking skills to steal the elections.
But according to Mr Basabe, Mr Correa does not need to resort to such strategies to stay in power.
"The possibility of President Correa losing the February voting is very low," he said, while also noting that a small majority of Ecuadoreans supported Mr Assange's asylum request anyway.
And the possibility of the British authorities storming into the Ecuadorean embassy in London to capture Mr Assange, raised on Wednesday by Foreign Minister Patino, has provided Correa supporters with a powerful rallying cry.
"This a decision of a sovereign government, which doesn't have to ask for British permission to act," said Rosana Alvarado, a representative in the National Assembly of the official Alianza Pais party.
"I hope the Ecuadorean people will remain united and reject any form of colonialism," said Paco Velasco, also from Alianza Pais.
To a large extent, however, repercussions will depend on the reaction of the British and Swedish governments - and, of course, of the United States.
And very few people seem to believe the Wikileaks founder will ever make it to South America.