The saga of a missing Chihuahua snatched off a Bayswater street has been come to a very happy end, with little Ted returned to his owner this morning.

Mary Daughton was walking her other dog at Houghton Reserve at around 5.45pm on Sunday, when a white car pulled up on the neighbouring street.

Two-year-old Ted was snatched by a passenger in the car, and Ms Daughton took to social media to plead for her pet's safe return.

This morning, Ms Daughton revealed Ted had been safely returned to his family.

She posted to Facebook that Ted had been found when he had been purchased by a "loving family", who had unknowingly bought him off the thieves.

"It's been an unbelievable journey of back alley deals... but at 10am this morning, Ted was returned.

"Thank you so so much to all the amazing people that have followed and shared this story... everyone in Perth got behind us, and you all had major parts in Ted's return," Ms Daughton posted.