Abdullah Ahmed Abdullah, who used the nom de guerre Abu Muhammad al-Masri, was accused of being one of the chief planners of devastating attacks on two US embassies in Africa in 1998.
He was killed on August 7, the anniversary of the attacks, the report said, citing unnamed intelligence officials.
The attacks on the US embassies in Kenya and Tanzania killed 224 and injured hundreds more.
A former Israeli intelligence official told the newspaper that Al-Masri is also accused of ordering the 2002 attack on an Israeli-owned hotel in Mombasa, Kenya which killed 13 and injured 80.
Al-Masri was driving his sedan close to his home when two Israeli agents on a motorcycle pulled up alongside his vehicle and fired five shots from a silenced pistol, killing al-Masri and his daughter, Miriam, who was married to Osama bin Laden’s late son Hamza bin Laden.
The assassination has not been publicly acknowledged by the US, Israel, Iran or al-Qaeda.
The US was keeping tabs on al-Masri and other members of the terrorist group in Iran for years, but it’s unknown what role the US played in the killing, if any.
Al-Masri was one of the earliest members of al-Qaeda and likely the next to lead the terror group after its current chief, Ayman al-Zawahri.
Following the shooting, Iranian media identified the victims as a history professor from Lebanon named Habib Daoud and his daughter, Maryam, the New York Times report said. A Lebanese news outlet and Iran’s Revolutionary Guards Corps said the victim was a member of the Hezbollah terrorist group, which is backed by Iran.
Daoud and Maryam did not actually exist, however. One intelligence official, and a former head of Egypt’s Islamic Jihad group, said the persona was an alias Iran provided to al-Masri.
It’s unclear why Iran would harbor al-Masri. Iran is a Shiite state, and has fought with al-Qaeda, a Sunni jihadist organization.
Intelligence officials told the Times that al-Masri was in Iranian “custody” since 2003 and lived in Tehran since at least 2015. While in Tehran, he was protected by Iran’s Revolutionary Guards Corps but allowed to move freely and travel abroad.
Experts told the Times that Iran may hold al-Qaeda members to prevent attacks in Iran, or to allow them to conduct operations against the US.