Officials named the dead man as Omar Farouq, a top lieutenant of Osama Bin Laden in south-east Asia.
Farouq was captured in Indonesia in 2002 but escaped from a US military prison in Afghanistan last year.
Here's more information on Farouq from 2002.
Information provided by Mr al-Farouq helped prompt the shutdown of 13 US embassies and consulates this week and led the government to elevate the terrorist threat status on Tuesday to "Orange", reflecting a high chance of attack on US interests.
"He's helping knit together a lot of things out there," said a Jakarta source familiar with the al-Farouq investigation. A security official in the region said, "his information was the final straw that pushed Washington and Jakarta into that increased awareness mode. He was able to provide a lot of detail."
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