Iraq's interior ministry undersecretary Ahmad Kazim told Aljazeera that Muhammad Zimam Abd Al-Razzaq al-Saadun was captured by special Iraqi police forces, acting on a tipoff from citizens, after they pursued him for 10 days.
Al-Saadun, who was a Baath party chairman and fomer Iraqi interior minister, was number 41 and the four of spades in the US list of 55 most-wanted Iraqis.
Forty four of the 55 Iraqis on the list have now either been detained or killed.
Meanwhile, two Iraqis were killed and three others wounded when resistance fighters mistakenly hit a minibus with a rocket-propelled grenade in Baghdad after trying to attack a US convoy, a hospital doctor said.
The incident happened in the Shia Muslim district of Shaawla on Sunday in northwest Baghdad.
Also on Sunday, a US military patrol came under small arms fire on the western edge of Baghdad, but there were no casualties.
SUVs are often used by US forces
A US military spokesman said the convoy was ambushed at 0600 GMT, adding no US vehicles or soldiers were harmed in the attack in the al-Adl suburb.
The exchange left the attackers' sports utility vehicle (SUV) in flames, but it was not clear if the assailants were hurt, the spokesman said. However, witnesses said bodies had been removed from the car.
After the firefight, policemen surrounded the area with US troops in back up. Initially, witnesses said they thought the SUV belonged to westerners, but the US military disputed that account.
SUVs are the vehicle of choice for the US-run occupation administration and western contractors.
Resistance fighters have previously ambushed SUVs with bombs and gunfire on the premise the passengers were associated with the US-led occupation force in Iraq.