Yunis Muhammad Ibrahim al-Hayari, a Moroccan, was killed during a raid on Sunday by security forces on an area where suspected militants were hiding, an Interior Ministry official was quoted by Saudi Press Agency (SPA) as saying.
The clashes took place in the Rawdah district, an upscale neighbourhood in eastern Riyadh, said Interior Ministry spokesman Brigadier Mansour al-Turki.
The unidentified official, quoted by SPA, said al-Hayari headed Osama bin Laden's al-Qaida network in the kingdom, which has been ravaged by attacks during more than two years of violence.
“He (al-Hayari) was nominated by his peers, and following the death of those preceding him, to be the head of sedition and corruption in the land,” the official said in the SPA report.
Al-Hayari topped a list, issued on Tuesday, of 36 most-wanted insurgents sought for participation in attacks in the kingdom dating back to 2003.
On Wednesday, Saudi Interior Minister Prince Nayef had warned of possibility of more attacks.
The oil-rich kingdom has suffered
a series of attacks since May 2003
Al-Hayari was believed to have had close ties to Abdul Karim al-Majati, an al-Qaida leader killed in April.
The Interior Ministry official said security forces conducted two simultaneous operations in eastern Riyadh to capture suspects and killed al-Hayari after a shoot-out, while arresting three other suspected insurgents who were not identified.
The report said six security force personnel were slightly injured in the gun battles, while weapons, munitions, communications equipment, computers and documents were seized at both scenes.
According to information released by Saudi authorities earlier this week, al-Hayari entered Saudi Arabia five years ago for the annual hajj pilgrimage season, but remained in the country with his wife and young daughter.
Saudi officials said al-Hayari had regularly disguised himself to avoid capture and had been previously seen in Riyadh.
The oil-rich kingdom has suffered a series of attacks since May 2003, when bombers attacked three housing estates for foreigners in Riyadh.
The kingdom had launched a wave of raids against the insurgents and issued a list of 26 most wanted in December 2003. Security forces have killed or captured 23 of the figures on that list.