The police commander of Borno state announced on state radio that Mohammed Yusuf, the leader of the sect some call the Nigerian Taliban, has "died in police custody."
He gave no further explanation, but the state governor's spokesman Usman Ciroma told The Associated Press: "I saw his body at police headquarters. I believe he was shot while he was trying to escape."
Yusuf's death could provoke more violence, though his followers in the Boko Haram sect may be in disarray after troops shelled his compound in the northern city of Maiduguri on Wednesday. Yusuf, 39, managed to escape with about 300 followers, some of them armed. His deputy, Bukar Shekau, was killed in the attack, according to Army commander Maj. Gen. Saleh Maina.
Troops killed about 100 militants by an AP reporter's count, half of them inside the sect's mosque. Soldiers then launched a manhunt, and Yusuf was reportedly found in a goat's pen at the home of his in-laws.
Human Rights Watch called reports of Yusuf's killing "extremely worrying."
"The Nigerian authorities must act immediately to investigate and hold to account all those responsible for this unlawful killing and any others associated with the recent violence in northern Nigeria," said Corinne Dufka, the group's senior West Africa researcher.
"The local commissioner of police should be immediately removed pending an investigation into Mr. Yusuf's killing," she said in a statement.
Seeking to impose Islamic Shariah law throughout this multi-religious country, the militants attacked police stations, churches, prisons and government buildings in a wave of violence that began Sunday in Borno and quickly spread to three other northern states.
But, leading Nigerian rights groups accuse security forces of killing bystanders and other civilians. A military spokesman denied the charge and said it was impossible for rights workers to tell who was a civilian and who was a member of Boko Haram, which means "Western education is sin" in the local Hausa language.
The government warned people to evacuate the area before the attack on the compound Wednesday, then shelled the compound and stormed the group's mosque inside, setting off a raging firefight with retreating militants armed with homemade hunting rifles and firebombs, bows and arrows, machetes and scimitars.
An AP reporter saw soldiers shoot their way into the mosque under fire and then raked those inside with gunshots.
The bodies of barefoot young men littered the streets of Maiduguri, the capital of Borno state, on Thursday morning as the army pursued the manhunt on the outskirts of the city. Police said most of the dead were fighters with Boko Haram. Army Col. Ben Anahotu said three police officers were killed.
Officials said at least 4,000 people have been forced from their homes by Wednesday afternoon, but it was not known how many have been killed, wounded and arrested.
President Umaru Yar'Adua said that security agents had been ordered to attack when the movement started gathering fighters from nearby states at its sprawling Maiduguri compound in preparation for "the holy war."
The militants are also known as Al-Sunna wal Jamma, or "Followers of Mohammed's Teachings," and some Nigerian officials have referred to them as Taliban. Analyst Nnamdi K. Obasi of the International Crisis Group said a few have fought with that radical movement in Afghanistan.
League for Human Rights director Shamaki Gad Peter said that after the siege rights workers saw the bodies of up to 20 people who were unarmed and appeared to have been shot from behind, possibly trying to escape the mayhem, he said.
Military spokesman Col. Mohammed Yerima initially denied allegations that the military intentionally killed civilians but said that the militants were indistinguishable from civilians.
"All the civilians that were living in that place were evacuated, to our knowledge," he said. "And those that remained in that enclave are loyalists and members of the group. So the issue of whether we have killed innocent civilians is not true."
He added, "The issue of identifying who is the Taliban or not, the human rights groups are not fair to security agencies because they don't have any marks on their faces. There is no way to know if this is Taliban or this is not."
Maiduguri resident Linda Dukwa said she had seen police execute two men Monday, frightening her and her family so badly that they did not venture out of their house, even for food, for days afterward.
The men "were dressed in white robes," she said, indicating they were sect members. "They were held by policemen. Then they shot their feet. After they fell on the ground, they (police) shot their heads."
National police spokesman Emmanuel Ojukwu denied such allegations of executions.
"We respect the rules of combat," he said.
Nigeria's 140 million people are roughly divided between Christians in the south and northern-based Muslims. Shariah was implemented in 12 northern states after Nigeria returned to civilian rule in 1999 following years of oppressive military regimes. More than 10,000 Nigerians have died in sectarian violence since then.
Dire poverty is at the heart of the violence, which analysts say reflects decades-old grievances of Nigerians whose governments are so corrupt and ineffective they do not deliver even basic services like running water and electricity.
Boko Haram members are particularly angry that full Shariah has not been implemented, especially the law's demand for a social welfare system helping poor people.
In recent months, police have been raiding Boko Haram hideouts and finding explosives and arms. The house at the compound in Maiduguri included a laboratory the military said was used to make bombs.