Jagr left the NHL to play in the Kontinental Hockey League for three seasons (Omsk, 2008-11).
"It's special," Ovechkin said. "If he didn't go back to the KHL, I think he would be 2 or maybe No. 1, but it is what it is. Now I'm happy, and being [the] No. 1 European player, Russian player, it's pretty cool."
Ovechkin tied Jagr on March 8 with two goals in a 5-4 win at Calgary. He had not scored in two games before giving the Capitals a 3-2 lead with 4:58 remaining in the third period Tuesday. Washington won 4-3 in a shootout.
Capitals forward Evgeny Kuznetsov won a face-off in the right circle and dropped the puck to Ovechkin, whose wrist shot sailed over the left shoulder of goalie Semyon Varlamov, a former teammate (2008-11).
"I just close my eyes and shoot," Ovechkin said. "I [had] pretty good chances previous games. Finally, 'Kuzy' wins a good face-off right on my stick. To score on a very good friend, 'Varly', it's nice too."
Kuznetsov collected the puck from the net before joining the rest of the Capitals, who came off the bench to congratulate Ovechkin at center ice.
"That's a colossal milestone," Washington coach Peter Laviolette said. "The league's been running for a long time. There's been a lot of players that have come through it. To move into third all-time and pass a great player like Jaromir Jagr, I got the chance to coach him (with the Philadelphia Flyers) and what a player he was. To pass him and continue to move up the list is pretty special. It's special for 'Ovi', for his family, for the guys in the room, especially the ones that have been here with him for a long time, for the fan base that's been here and supporting him. What a great night, a special night."
Islanders coach Barry Trotz was Capitals coach from 2014-18.
"Obviously, congrats to him," Trotz said. "I wish he wouldn't have scored against us, but he keeps climbing the ladder."
Ovechkin began the season sixth with 730 NHL goals and passed Marcel Dionne for fifth (731) against the New York Rangers on Oct. 13, and Brett Hull for fourth (741) against the Columbus Blue Jackets on Nov. 12.
"For us, he's so close to us, and we never even talk about [how he] accomplishes all those milestones," Kuznetsov said. "I'm pretty sure one day when I'm going to retire, I hope he's going to be still friends with me. We're going to sit somewhere and think about and remember some of those milestones. For now, we're kind of, turn the page and focus next."