Part of Urchfont was cordoned off when contractors working on a housing development dug up a suspected bomb on Tuesday.
A cordon was put in place by police and an Army bomb disposal team from Tidworth attended but they gave the all-clear when they found it was an empty artillery shell.
The incident happened at Manor Farmyard, near the duck pond where Redcliffe Homes began work on the site at the beginning of this month to build 19 homes.
Police were called at 12.51pm and the Manor Farmyard site was evacuated while residents living nearby were advised to stay at the rear of their properties until the bomb disposal team had assessed the shell.
Resident Rozzy Roan, who lives in High Street about 30 yards away from the site, was working from home and saw the drama.
She said: “The police cordoned off the road in front of me and I asked my neighbour what was going on and was told the contractors had found a bomb on the site.
"The bomb disposal team arrived within an hour. They walked in, inspected it and walked out with it, it was a bit of an anti-climax.
“When you live in the shadow of Salisbury Plain you are used to bombs, you are constantly hearing firing. It was more nerve wracking when the live shell landed at Patney.”
The incident was over just before 3pm in time for residents to do the school run. Building work on the Manor Farmyard site resumed that afternoon.
A Wiltshire Police spokesman said: “We were called and it was described to us as the impact end of an artillery shell and a bit rusty.
"The bomb disposal team confirmed it was spent shell casing and took it away with them. We obviously had to act to make sure people were safe.”
A spokesman for Redcliffe Homes said: “Footings were being dug for our development at Snooks Yard, Urchfont, on Tuesday and contractors dug up something suspicious which they thought was a Second World War bomb so they stopped work and called the authorities.
"The police and Army bomb disposal team attended and they said it wasn’t dangerous and took it away with them.
“Whether the shell was used in the Second World War or from an exercise on Salisbury Plain, we don’t know. “