The show, described as a “festival of flame” honouring Britain’s ancient traditions and festivals, brought to a close 11 days of sport.
UK band Coldplay led the show, which started at 20:30 BST, with a live set reflecting the four seasons.
The event ended what organisers say has been “the greatest Paralympic Games ever”.
Unlike the other Games ceremonies, the 4,200 athletes were seated around the main arena, putting them at the heart of the action.
Declaring the 2012 Paralympics closed, International Paralympic Committee president, Sir Philip Craven, said “these Games have changed us all forever.”
Paralympians Ellie Simmonds and Jonnie Peacock helped to put out the Paralympic flame, which was shared out across the stadium symbolising “the eternal nature of the flame living among us all”.
Each participating country will take home one of the 200 copper petals that made up the Paralympic cauldron.
As Sunday’s show began, a tribute was paid to armed forces charity, Help for Heroes, and armed forces personnel who provided last-minute Olympic security after private firm G4S failed to recruit enough guards.
GB Paralympians David Weir and Sarah Storey, who both won four gold medals at the Games, carried the British flag into the Stadium, as flagbearers representing 164 nations participating in the Paralympics entered the arena.
And Captain Luke Sinnott, who lost both legs and an arm in an IED bomb blast while serving in Afghanistan, climbed the flagpole to raise the Union Jack.
Coldplay sang songs from their five albums, while dancers including the Candoco Dance Company – a contemporary group of 12 disabled and non-disabled dancers – performed with flames around the burning face of a “sun king”.
Apart from Coldplay’s live set, tonight’s sold-out finale featured performances from pop star Rihanna, rapper Jay-Z and a cast of around 1,200 performers on three circular stages – Summer, Winter and the Sundial.
If the Paralympics had to end then they did so in style, with a superb closing ceremony that had a bit of everything.
There were spectacular moments, dazzling fireworks, great live music and tributes to all the right people – the armed forces, the Games Maker volunteers and the athletes.
The speeches were made in the right tone and contained good and appropriate anecdotes and the tale of the four seasonss from autumn going to spring showed the continuing nature of life.
And that is what everyone has to face now with a Monday morning that won’t contain tales of medals won and those possibly to come.
It is back to reality for most people and on to pastures new for others.
“The idea is the coming together as one,” said artistic director Kim Gavin behind the Festival of Flame.
“We are known as a nation for having the most festivals, it is something that we do – with 600 festivals a year.
“We pay tribute to all the human spirit and achievement through this wonderful sport of the last two weeks.”
A motorcade of “weird and wonderful” vehicles, crows on stilts, and flaming bicycles invaded the Stadium during the show.
And Kenya’s Mary Nakhumicha ZakayoIrish and Irish runner Michael McKillop were presented with gold medals in recognition of them winning the Whang Youn Dai Achievement Award – for athletes who exemplify the best spirit of the Paralympic Games.
Flowers were also presented to honour the 70,000 Games Maker Olympic and Paralympic volunteers.
Some 120 child volunteers from east London are taking part in tonight’s spectacle, along with disabled aerial performers from Circus Scape and The British Paraorchestra.
After being passed the Paralympic flag by London Mayor Boris Johnson, performers from Rio – which will stage the games in 2016 – put on a colourful performance fusing hip-hip freestyle and samba, performed by disabled and non-disabled dancers.
Speaking to the 80,000-strong crowd, organising committee chairman Lord Coe said the UK would “never think of sport the same way and we will never think of disability the same way.
“The Paralympians have lifted the cloud of limitation.”
He added: “Finally, there are some famous words you can find stamped on the bottom of a product. Words, that when you read them, you know mean high quality, mean skill, mean creativity.
“We have stamped those words on the Olympic and Paralympic games of London 2012.
“London 2012. Made in Britain.”
IPC president Sir Philip Craven said the Games had been “unique and without doubt, in my mind and those of the athletes – the greatest Paralympic Games ever”.
Speaking before the start of the ceremony, Prime Minister David Cameron said: “I think it’s been an absolute triumph from start to finish and I’m really proud of the country, not just that we’ve put on a great show, but we’ve had these great audiences”.
Mr Cameron, whose disabled son Ivan died in 2009, added: “I think back to Ivan. As every parent, you think about all the things they can’t do, but at the Paralympics they are superhuman, you see all the things they can do.”
He also said it would give momentum to sports participation and the Paralympics had changed perceptions of disabled sport.
Mayor of London Boris Johnson said he hoped to see a social and cultural legacy from the Games.
China has finished top of the Paralympic medals table, with 231 medals – 95 gold. Great Britain cemented third place behind Russia, with a tally of 120, including 34 golds.