The 34-year-old rapper has rocketed to fame since "Gangnam Style" — in which he performs his now famous horse-riding dance — became a worldwide hit following its release in July.
Earlier this month the song ousted Jennifer Lopez's dance hit "On the Floor" from second place on YouTube, and on Saturday it overtook Bieber's hit. In the evening, it had racked up 805,055,375 views against 803,732,561 for "Baby".
Psy's song, which refers to an upmarket neighbourhood in Seoul, has topped charts from Britain to Australia and has been name-checked by global notables including US President Barack Obama and UN chief Ban Ki-moon.
It has spawned numerous tribute videos, been imitated by an impressive roster of big names, including Chinese dissident artist Ai Weiwei, and helped the singer land a contract with Bieber's management agency.
And the public has joined in, with tens of thousands turning out for giant flashmob performances of Psy's horse-riding dance in cities like Paris and Rome.
The quirky star, whose real name is Park Jae-Sang, has won adulation in his homeland for the global hit and was this month awarded one of South Korea's highest cultural honours, the Okgwan Order of Cultural Merit.
South Korea sees popular culture as a potent export force, providing international exposure for a country that still feels overlooked in comparison to neighbours China and Japan.
The government has spent substantial time and money supporting the so-called Hallyu (Korean Wave) of TV shows and pop music that has swept across Asia in the past decade.
The song has also shown impressive staying power: it is still going strong four months after it went viral on YouTube, despite calls from some commentators for the craze to finally end.
Psy meanwhile, has gone from strength to strength, gaining the ultimate showbiz accolade earlier this month by performing a mash-up of Gangnam Style with pop icon Madonna during her concert at New York's Madison Square Garden.
The rapper recently unveiled plans for his next song in an interview with CNN, saying the lyrics would be a mix of English and Korean.
Will he be able to produce another hit single? Only time will tell.
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