The 86-year-old monarch later said in a special television message shown across the nation and the Commonwealth that the jubilee had been a "humbling experience."
"It has touched me deeply to see so many thousands of families, neighbours and friends celebrating together in such a happy atmosphere," the queen said.
"I will continue to treasure and draw inspiration from the countless kindnesses shown to me in this country and throughout the Commonwealth," she added. "Thank you all."
But 90-year-old Prince Philip, the queen's stalwart companion throughout her reign, was poignantly absent from the red-and-gold-draped balcony after he was taken to hospital with a bladder infection on Monday.
The couple's youngest son Prince Edward told reporters after visiting Philip in hospital that his father was "getting better" but he will remain in hospital for several days.
The queen braved the rain with her heir Prince Charles and his wife Camilla as well as Prince Harry, Prince William and his wife Catherine to wave from the balcony.
"We were told by police that there were 1.5 million in and around The Mall area," a spokeswoman for Buckingham Palace told AFP in reference to the packed avenue running from the palace to Trafalgar Square.
The crowd boomed the national anthem as historic World War II planes flew overhead, followed by the Royal Air Force Red Arrows display team who filled the skies with plumes of red white and blue smoke.
The queen's guard also released celebratory cascades of rifle fire.
Minutes earlier, the royals had driven to the palace from the Houses of Parliament in horse-drawn carriages, again cheered by thousands -- many of whom camped out overnight to get a glimpse of the queen.
Military bands and more than 100 mounted soldiers in traditional uniform accompanied the carriages in a classic display of British pageantry. Banners saying "Elizabeth the Great" were held above the crowd.
In Philip's absence, Charles and Camilla joined the queen, who was dressed in a mint-green silk coat scattered with crystals, in the red and gold 1902 state landau.
Prince Harry joined William and Catherine, who wore a beige lace dress by Alexander McQueen, as they smiled and waved from their own carriage -- their first such carriage trip since William and Catherine married in April 2011.
Jill Davies, a silver-haired executive researcher from Suffolk in eastern England, waved her Union Jack as the queen went past her at Downing Street, where the prime minister's official residence is located.
"Prince Philip is poorly but he's done his bit, bless him," she told AFP. "It was fantastic. I was outside Downing Street so I saw it all. The queen was waving to the crowds."
Charles had earlier taken his father's place by the queen's side at a special jubilee service at St Paul's Cathedral attended by political leaders, foreign ambassadors and royals.
Leading the service beneath the imposing dome of the cathedral, Rowan Williams, the Archbishop of Canterbury and leader of the world's Anglicans, paid tribute to Philip as well as the monarch.
"We are marking six decades of living proof that public service is possible and that it is a place where happiness can be found," said Williams, adding that their prayers were with Philip.
US President Barack Obama also paid tribute to the queen on Tuesday, describing her as "tireless leader."
"While many presidents have come and gone, your majesty's reign has endured," he said in a video message. "That makes your majesty both a living witness to the power of our alliance and a chief source of its resilience."
The monarch insisted on attending Monday's spectacular concert in front of the palace -- which featured stars including Paul McCartney, Elton John and Stevie Wonder -- despite Philip's ill health.
After the final set, Prince Charles urged the crowd to show their support, and they responded by chanting "Philip, Philip".
Philip's new health scare comes after he suffered chest pains during the Christmas break and was treated for a blocked coronary artery.
He appeared in good health on Sunday as he travelled on the royal barge in chilly conditions during a 1,000-boat river pageant, the centrepiece of the jubilee, but doctors said it could have worsened his infection.
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