Stephanie Noble, 67, had been sharing her home on the Isle of Lewis in the Outer Hebrides with the pony since before Christmas 2011.
But last Thursday council officers took Grey Lady Too away, and handed the pensioner a letter saying they planned to seek a disposal order from a court.
However the Western Isles Council has confirmed that the pony has been taken to the Uists, and has promised Ms Noble "visitation rights."
During the weekend Ms Noble was allowed to telephone the pony's new carer.
"I had a good conversation about Lady over the phone and I am reassured that she is in good hands," said Ms Noble. "I just can't believe how cruel this council is. I intend to win her back."
Nigel Scott, spokesman for Western Isles Council said: "This action was taken after animal health interventions certified that the pony was likely to suffer if its circumstances did not change."