This appears to be the first confirmation that the al-Qaida spokesman is held in Iran.
"Iran offered to hand over Abu Ghaith to us ... But we don't want him. He is not a Kuwaiti citizen," Sheikh Nawaf al-Ahmad al-Sabah told the Riyadh-based “Okaz” daily.
"He was a holder of Kuwaiti citizenship but it was withdrawn ... According to our information he is in Iran but Kuwait has refused to receive him," the Kuwaiti minister said.
Abu Ghaith's wife and children, who live in the emirate, remain Kuwaiti citizens with full rights.
Abu Ghaith, reportedly detained in Iran along with top members of Usama bin Ladin's network, was stripped of his Kuwaiti nationality in October 2001 because of links to the September 11 attacks.
The former school teacher and imam appeared numerous times on Aljazeera television threatening more attacks against the United States.
In April 2002, he said on Aljazeera that the September 11 hijackers had been driven by "Islamic" considerations.
Diplomatic sources have said Iran is engaged in secretive and complex negotiations with Saudi Arabia, Egypt and Kuwait over the extradition of several top bin Ladin aides. Iran has refused to publicly reveal their names.