The robbers numbered about 50 and came armed with high-caliber weapons, grenades, dynamite and caltrops, those spiked devices designed to puncture tires.
The Paraguayan government says they escaped by water as well as land, and when their assault on an armored car company was done, they made off with millions of dollars.
Authorities in Paraguay and Brazil are now searching for those behind the dramatic assault on the company located in the triple-border region, where Paraguay, Brazil and Argentina all meet. The borders in the area are known to be lax, with contraband electronics, drugs and arms flowing easily in and out of the three countries.
Around 12:30 a.m. Monday, the robbers blew up the vaults of Prosegur in the Paraguayan city of Ciudad del Este, just a few miles from the Amizade International Bridge, which connects it to Brazilian city of Foz do Iguacu. The explosives left gaping holes in the side of a building.
On Tuesday, Brazilian police arrested eight people near the border with Paraguay after a shootout with members of a gang suspected of carrying out what is being called the robbery of the century.
Three other gang members were killed in the gunfire exchange, and police recovered six rifles, ammunition, two boats and seven vehicles in their search after the shootout.
Early news reports from Brazil and Paraguay put the haul at $40 million, but on Tuesday afternoon a company representative said it was much less, though still substantial.
"There were $49 million" in the building, Prosegur's executive director, Juan Cocci, told the radio station Mitre de Buenos Aires. "Today we can say there are approximately $8 million missing. We still don't know the exact figure, but it has dropped a lot."
Authorities in Paraguay and Brazil said they suspect the culprits were members of an infamous Brazilian criminal organization called First Capital Command, or PCC.
The robbers are said to have arrived in pickup trucks and were armed with antiaircraft machine guns and grenades.
Directly after the explosion, the gang members took residents of neighboring homes hostage during a first shootout with Paraguayan police, which lasted two hours and left one officer dead. Three civilians were injured.
Police said they encountered large-caliber weapons, explosives and caltrops, as well as snipers.
During their escape, the robbers used Molotov cocktails to set 15 vehicles on fire in different areas of the city, the Paraguayan national police said. One vehicle, which was abandoned in front of Prosegur, had Brazilian plates and was used to transport explosives and other equipment used in the heist. The other 14 apparently were meant to create diversions, with one blocking the road out of town. A local police station was also attacked.
In a radio interview Monday, Paraguayan Interior Minister Lorenzo Lezcano said that most of the vehicles used in the robbery had Brazilian plates and that one hostage heard the gang members speaking in Portuguese.
Police believe that the gang escaped in several of the security company's armored vehicles and that they may have transferred the stolen money into boats waiting on the Parana River. Some of the robbers are thought to have traveled about 30 miles downriver to the Brazilian city of Itaipulandia, where the second shootout and arrests took place.
The PCC has been responsible for similar heists in the past, albeit on a smaller scale. The group recently carried out several robberies in the state of Sao Paulo, where gang members armed with rifles and machine guns used explosives to gain access to large sums of money. They also left burning vehicles in the middle of roads on their escape route in order to slow the ensuing police chase.
This isn't the first time Brazilians were involved in a million-dollar bank heist. More than 10 years ago, nearly $70 million was stolen from the country's Central Bank in Fortaleza in what is considered to be one of the most creative heists in history.
The robbers were able to dig a tunnel under the bank that spanned more than 250 feet by posing as a landscaping company. They even included lighting and an air-conditioning system during the three months it took to build their way in and out of the bank. Until this day, not all those involved have been captured, and only $9 million have been recovered.
Langlois is a special correspondent.
6:35 p.m.: This story was updated with extensive details about the heist and the police response.