Julian Assange has signalled he will remain inside the Ecuadorian embassy in London despite the Swedish authorities suddenly dropping a seven year investigation against him.

The WikiLeaks founder made a rare appearance on the balcony of the central London building to hail the decision by Sweden's Director of Public Prosecutions as an "important victory."

He gave a clenched fist salute to his supporters, and scores of journalists and TV crews, before maintaining that a "legal conflict" with the United States and the UK continues.

The Australian, who has lived inside the embassy for almost five years, said the "road is far from over", adding it was "extremely regretful" that he was still being threatened with arrest if he leaves the embassy.

Mr Assange said he had spent seven years either under house arrest or living inside the embassy, without charge, as he faced sex-related allegations in Sweden, which he has always denied.

He had missed seeing his children growing up. "That is not something I can forgive, or forget," he said, maintaining that he had been the victim of a "terrible injustice".

Detention and extradition without charge had become a feature of the EU, but it was not something expected from the rule of law in the UK, he said.

Mr Assange thanked the government of Ecuador for granting him political asylum despite "intense pressure", as well as his legal team and others who had stood by him.

"We have today won an important victory, but the road is far from over. The proper war is just commencing."

He pledged that WikiLeaks will continue distributing material about the activities of the CIA in the United States, and will "accelerate" its publications.

"The claim that the UK has the right to arrest me for seeking asylum in a case where there have been no charges is simply untenable.

"My legal staff have contacted the UK authorities and we hope to engage in a dialogue about what is the best way forward."

Mr Assange said the UK had refused to confirm or deny whether there is a warrant from the US for his extradition, insisting he was happy to talk to the US Justice Department.

He returned into the building which has been his home for almost five years, without answering questions.

The Ecuadorian government is to step up efforts to allow Mr Assange to continue his asylum in its country after Sweden's Director of Public Prosecutions Marianne Ny said she had decided to "discontinue" her investigation.

Scotland Yard said it was obliged to execute a warrant issued by Westminster Magistrates' Court for the arrest of Mr Assange following his failure to surrender to the court in June 2012, should he leave the embassy.

Asked if Britain would now support a request to extradite Mr Assange to the United States, Prime Minister Theresa May said: "We look at extradition requests on a case-by-case basis.

"In relation to Julian Assange, any decision that is taken about UK action in relation to him were he to leave the Ecuadorian Embassy would be an operational matter for the police."

The Crown Prosecution Service said that following the Swedish authorities' decision to drop the investigation, a European Arrest Warrant against him was discharged at Westminster Magistrates' Court.

Mr Assange was questioned six months ago in the presence of Swedish officials, who faced criticism for the length of time it has taken to make a decision.

Ecuador's foreign minister Guillaume Long said: "Ecuador regrets that the Swedish Prosecutor delayed more than four years in carrying out this interview.

"Given that the European Arrest Warrant no longer holds, Ecuador will now be intensifying its diplomatic efforts with the UK so that Julian Assange can gain safe passage in order to enjoy his asylum in Ecuador."

Mr Assange believes he faces extradition to the United States for questioning over the activities of WikiLeaks if he leaves the embassy.

Scotland Yard said: "Westminster Magistrates' Court issued a warrant for the arrest of Julian Assange following him failing to surrender to the court on June 29 2012. The Metropolitan Police Service (MPS) is obliged to execute that warrant should he leave the Embassy.

"Whilst Mr Assange was wanted on a European Arrest Warrant (EAW) for an extremely serious offence, the MPS response reflected the serious nature of that crime.

"Now that the situation has changed and the Swedish authorities have discontinued their investigation into that matter, Mr Assange remains wanted for a much less serious offence. The MPS will provide a level of resourcing which is proportionate to that offence.

"The priority for the MPS must continue to be arresting those who are currently wanted in the capital in connection with serious violent or sexual offences for the protection of Londoners."

The Metropolitan Police stopped its round the clock presence outside the Embassy in October 2015 amid controversy over the escalating cost of the exercise - believed to be more than £12 million.

He was on bail when he arrived at the Ecuador Embassy in central London almost five years ago.

Ms Ny said the motive for her decision was that there is no reason to believe the decision to surrender Mr Assange to Sweden can be executed in the foreseeable future.

She told a press conference in Stockholm that the investigation could be reopened if Mr Assange returns to Sweden before the allegation against him elapses under Swedish law in August 2020.