The former lightweight champion used his own clothes to hang himself from a bar in his cell early Monday, Venezuelan Federal Police Chief Wilmer Flores told reporters.
He said Valero was found by another inmate, who alerted authorities in the police lockup in north-central Carabobo state. Valero still showed signs of life when they took him down, but they were unable to save him and he died about 1:30 a.m., Flores said.
The 28-year-old was detained Sunday on suspicion of killing his wife. Prosecutors said Sunday night that they had planned to charge Valero in the killing.
Valero was detained after police found the body of his 24-year-old wife in a hotel in Valencia. The boxer left the hotel room around dawn Sunday and allegedly told security he had killed Jennifer Viera, Flores said.
The fighter was a household name in Venezuela and had a huge image of President Hugo Chavez tattooed on his chest, along with the country's yellow, blue and red flag.
His all-action style and 27-0 record all by knockouts earned him a reputation as a tough, explosive crowd-pleaser. Venezuelans called him "Inca," alluding to an Indian warrior, while elsewhere he was called "Dinamita," or dynamite.
The former WBA super featherweight and WBC lightweight champion had been in trouble with the law before.
Last month, Valero was charged with harassing his wife and threatening medical personnel who treated her at a hospital in the western city of Merida. Police arrested Valero following an argument with a doctor and nurse at the hospital, where his wife was being treated for a series of injuries, including a punctured lung and broken ribs.
The Attorney General's Office said in a statement that Valero was detained March 25 on suspicion of assaulting his wife, but his wife told a police officer her injuries were due to a fall. When the boxer arrived moments later, he forbade Viera from speaking to the police officer, and spoke threateningly to the officer, prosecutors said in a statement.
The Attorney General's Office said a prosecutor had asked a court to order Valero jailed but that the judge instead placed him under a restraining order that barred him from going near his wife, a condition he repeatedly violated.
Police found three stab wounds on Viera's body, but investigators who searched the hotel rooms had yet to find the weapon used in the killing, Flores said.
In the ring, Valero shot to fame when he won his first 18 fights by first-round knockout, setting a record that has since been eclipsed by Tyrone Brunson. Valero last fought in February, stopping Antonio DeMarco in a fight in Monterrey, Mexico.
He was replaced as WBC lightweight champion in February after he expressed a desire to campaign in a higher weight division, WBC president Jose Sulaiman said.
Valero was involved in a motorcycle accident in 2001 that caused a cerebral hemorrhage, and because most jurisdictions refuse to license a fighter who has sustained a brain injury, he was unable to fight in the United States. The boxer wound up fighting mainly in Japan and Latin America, where he won his first title in 2006.
Valero also was charged with drunken driving in Texas, which is the primary reason he was denied a U.S. visa.
He accused the U.S. government of discrimination, saying his application wasn't approved because of his sympathy for Chavez, a fierce critic of the U.S. government.
He appeared at times as a special guest at televised events hosted by Chavez and was lionized by Chavez supporters as a national hero, while some critics accused him of avoiding punishment for past problems due to close links to the government.