Gorilla in Pink Mask has been a popular landmark with locals and art tourists on Bristol's Fishponds Road for more than 10 years.
Sprayed on to a former social club, Banksy's gorilla was replaced with a lively white by the building's new occupant, a Muslim group, who were unaware of the work's origins.
"I thought it was worthless," Saeed Ahmed said.
"I didn't it know it was valuable. That's why I painted over it. I really am sorry if people are upset."
Similar Banksy murals have sold for huge sums in the past, including a piece on London's Portobello Road, which made £208,100 at an online auction in 2008.
Banksy is such a collectible artist that local councils and individuals are loathe to remove his works if one if lucky enough to appear on their property.
But his work is not valued by all.
In 2007, Network Rail ordered the removal of a Banksy at London's Waterloo Station, which depicted a monkey about to blow up a bunch of bananas.
It is rare, however, for a Banksy to be removed in innocence.
There are hopes that the work could be recovered through careful restoration, or even that Banksy may provide a new piece for the wall, although the elusive artist is not known for producing artworks to order.
Paul Fraser Collectibles will keep you updated with the latest developments on the missing gorilla.
In other urban art news, Mr Brainwash, the protagonist in Banksy's film Exit Through The Giftshop, has been hired to promote the Red Hot Chili Peppers' new album via a series of posters in Los Angeles.
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