The device was first released by the then Apple CEO Steve Jobs and retailed at a starting price of $499 (about £269 at the time), but was discontinued just two months later amid disappointing sales figures.

Consumers mostly favoured the 8GB model - launched at the same time with extra storage capacity but priced at around $100 more.

Described by LCG Auctions as "one of the most important and ubiquitous inventions of our lifetime", the auction of the "exceedingly rare" factory-sealed 4GB model was originally expected to raise up to around £75,000.

Its final sale price was $190,372.80 (£145,531.44) with the device attracting 28 bids.

LCG Auctions said the "elusive model" is "considered a Holy Grail amongst iPhone collectors" with its "extreme scarcity directly related to its limited production".

The auction firm's website also said: "Our offering is an exceedingly rare, factory sealed, first-release 4GB model in exceptional condition.

"Virtually flawless along the surface and edges, the factory seal is clean with correct seam details and tightness.

"Brand new, never activated.

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"The phone's provenance is pristine as the consignor was part of the original engineering team at Apple when the iPhone first launched.

"Collectors and investors would be hard pressed to find a superior example.

"Relevance and rarity comprise a winning formula for this red-hot collectible."