Mullah Abdul Ghani Brader, a senior Taliban military commander, has been captured in Karachi, Pakistan's largest city, according to US media.
Unnamed US sources quoted by news agencies said Mullah Brader, the Afghan Taliban's number two, was captured in a secret raid by US and Pakistani intelligence forces several days ago.
Citing US government officials, the New York Times said Mullah Brader had been in Pakistani custody for several days and was being interrogated by US and Pakistani agents.
The New York Times described him as the most significant Taliban figure captured since the start of the Afghanistan war.
However, a Taliban spokesman denied the report of his capture, saying he was still in Afghanistan actively organising the group's military and political activities.
"He has not been captured. They want to spread this rumour just to divert the attention of people from their defeats in Marjah and confuse the public," Zabihullah Mujahid told Reuters, referring to a US-led Nato offensive in Afghanistan's Helmand province.
Mullah Brader is believed to have been in day-to-day command of the group's leadership council, the so-called Quetta Shura, ever since the group's founder and leader, Mullah Mohammed Omar, disappeared from view in the aftermath of September 11 attacks in 2001.
||Born in Dehrawood district of Uruzgan province, in 1968
||Number two to Taliban founder Mullah Omar
||In charge of Taliban's military operations and financial affairs
||Former defence minister for the Taliban
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Al Jazeera's Zeina Khodr, reporting from the capital Kabul, said Mullah Brader's capture, if true, is "significant".
"... Mullah Brader would be a very good source, concerning information about the Taliban leadership, simply because as far as we know, he has a very good relationship with Mullah Omar, and their relationship goes back to the days when the Taliban were really in power," she said.
"Mullah Brader was a man in charge of military operations who was given the opportunity to make decisions. The ultimate decisions were made by Mullah Omar, but Mullah Brader really played an important role."
The New York Times report said it was not clear if Brader was talking, but quoted the officials as saying his capture could lead to other senior Taliban leaders.
However, it has recently been suggested that Mullah Brader may have had a fallout with the Taliban leadership.
"Mullah Brader has become a liability because sources say he was taking part in negotiations with the Afghan government between Taliban leaders, and the UN special representative to Afghanistan, Kai Eide," Al Jazeera's Khodr said.
"Of course the Taliban deny that any such meetings took place."
The New York Times cited officials as saying the operation to capture Mullah Brader was conducted by ISItogether with CIA operatives.
It said it learned of the operation on Thursday, but delayed reporting it after a request by White House officials who said disclosing it would end a very successful intelligence drive.
The New York Times said it was now publishing the report because White House officials acknowledged that news of the capture was becoming broadly known in the region.
Speaking to Al Jazeera, Hamid Gul, the former head of Pakistan's Inter-Services Intelligence (ISI), said that the fact the arrest had reportedly been made during a joint operation by US and Pakistani agents was "unusual".
"This is rather unusual, one of the top leaders of the Taliban leaders being caught here and that it was reported that this was a joint operation between the US and Pakistan intelligence this was unprecedented," he said.
The US and Afghanistan have repeatedly pressed Pakistan to do more to combat Afghan Taliban and al-Qaeda fighters operating on its territory.
Rehman Malik, Pakistan's interior minister, did not explicitly deny the reports, but branded them as "propaganda".
"We are verifying all those we have arrested. If there is any big target, I will show the nation," Malik said.
|Mullah Omar, pictured, has been 'in hiding' since the September 11 attacks in 2001
"If the New York Times gives information, it is not a divine truth, it can be wrong. We have joint intelligence sharing and no joint investigation, nor joint raids."
"We are a sovereign state and hence will not allow anybody to come and do any operation."
The White House also refused to confirm whether Brader had been captured, but it did say that there had increased co-operation by Pakistani authorities in tackling the Taliban and al-Qaeda.
"I think we have in the course of many months seen an increase in that co-operation," Robert Gibbs, the White House spokesman, said.
"We've seen an increase in Pakistani pushback on extremists in their own country, which I think is beneficial not simply for us."
The arrest came as US-led forces across the border in Afghanistan undertake one of Nato's biggest offensives against the Taliban.
The assault, one of the biggest in the eight-year war, is the first test of US President Barack Obama's plan to send 30,000 more troops to Afghanistan, where the Taliban has made a steady comeback since a US-led invasion ousted it in 2001.