The conflict with Islamists has taken a huge toll

Soldiers cornered and shot Nabil Sahraoui, head of the Salafist Group for Preaching and Combat (GSPC), and several other senior militants.

He took over as the GSPC leader last year, declaring support for al-Qaeda.

The group is involved in the Islamist insurgency in Algeria that has killed some 150,000 people and last year kidnapped 32 European tourists.

Ongoing raid

A military statement said the shooting happened in the El-Kseur region in Bejaia province, 236 km (146 miles) east of the capital Algiers.

Violence has dropped sharply over the past two years and the GSPC is regarded as the only remaining major militant organisation in Algeria.

Sahraoui's death represents another blow to the insurgents, says the BBC's Heba Saleh, reporting from Cairo.

Nevertheless, analysts and diplomats said the avowed allegiance between the GSPC and al-Qaeda was worrying.

Army radio said the man seen as Sahraoui's potential successor, Abdi Abdelaziz nicknamed "Okacha the paratrooper", was among those killed.

Troops had been carrying out raids after 12 soldiers were killed in an ambush earlier this month.

Terror list

The GSPC's actual strength is unknown, but experts believe it has around 500 fighters.

The Salafist group, created in 1998, is one of two movements fighting to install an Islamic state in Algeria. It grew out of another of Algeria's leading militant groups, the Armed Islamic Group (GIA).

It had confined itself mainly to military targets, winning some support among the Algerian population.

Sahraoui, also known as Abou Ibrahim Mustafa and in his 30s, had a reputation for ruthlessness. He was said to have wanted to take the group on a more radical route when he assumed the leadership last year.

Together the GSPC and the GIA are blamed for some 150,000 killings since the insurgency began in 1992 following the military's cancellation of elections to keep an Islamic party from power.

The 32 tourists seized by the GSPC while travelling in the Sahara desert were all eventually released, reportedly after ransoms were paid, except for one woman who died of heatstroke.