DCC city services general manager Sandy Graham said the flowers in the heritage lane would help showcase the importance of city lanes as vital pedestrian links.
It would also be used to guide tourists to a temporary tour bus stop outside the library on Moray Pl.
She said local tour operators had agreed to relocate their pick-up and drop-off points during the Octagon Experience.
"Rather than using normal wayfinder signage, it was agreed that something vibrant and unique would be ideal."
The artist behind the colourful display was Theme Productions and feedback from the public had been positive.
The installation had cost $34,000 and would be returned to the artist in April.