Police had earlier cordoned off a pedestrian mall and nearby streets with yellow tape around 1:15 p.m., while yelling "Get back, get back" at onlookers and guiding bomb-sniffing dogs through the area.
The bomb squad X-rayed the soft-sided green cooler found on the pedestrian mall to determine, "in an abundance of caution," whether it posed a threat, NYPD spokesman Paul Browne said.
Six NYPD officers opened the cooler, took out its contents and carried it off about an hour later, when the department said there was no threat.
"It was exciting, but it seemed a little silly, after all - a cooler that somebody left there," said psychiatrist Thor Bergersen, of Newton, Mass., who watched the drama from the eighth floor of the Marriott Marquis hotel.
The department has had a 30 percent uptick in the number of suspicious package reports since the failed bombing in Times Square.
"This is something that happens fairly regularly," Police Commissioner Raymond Kelly said Friday. "When you have a major event, the reports of suspicious packages will go up. I think to a certain extent, people are becoming more suspicious, more vigilant and that results in more calls."
Times Square vendor Walter "Candyman" Wells was among those feeling suspicious.
Sitting on a stool near his table of T-shirts, he looked out Friday onto the street, already back to its usual bustle after the scare. "I think they're testing us, whoever is doing this. They're testing our tolerance for putting up with this chaos."
"They're playing chess with us right now, but they ain't gonna win," the Vietnam veteran said. "'Cause we're the Bobby Fischers."
No evacuations have been ordered from buildings, but workers were told to stay indoors as the police responded. Cars approaching the area were told to turn back as an eerie silence descended on the area.
Henry Goldfine, an attorney from New Jersey attending a meeting at the hotel, said he had planned to relax on the Times Square pedestrian mall but was turned away.
"Instead, I'm going back where there's no air and no light," Goldfine said, standing near the hotel. "We don't have things like this in New Jersey."
On an average day, police get 90 to 100 reports of a suspicious package. Browne said there were more than 145 reports on Thursday alone.
A package discovered earlier Friday near the area where the car bomb was discovered turned out to be someone's lunch.
On Wednesday, the bomb squad was called out to look at a truck with a strong odor of gasoline abandoned on the Robert F. Kennedy Bridge, but nothing dangerous was found inside.
"People are being more vigilant, and that's a good thing," Browne said earlier Friday. "People are also getting their lost property returned a lot faster these days," he quipped.
