Imad Mughnieh, the senior Hezbollah commander accused of master-minding the terrorist spectaculars of war-torn Lebanon in the 1980s, met his end in a car-bomb explosion in a smart suburb of Damascus on Tuesday night.

Mughnieh, 45, ranked second only to Osama bin Laden on Washingon’s most-wanted list, was accused of killing more Americans than any other militant before the attacks of September 11, 2001, earning him a $25 million (£13 million) bounty for his capture and the undying enmity of the US and Israel.

Mughnieh died at 10.45pm in Kfar Soussa, when a bomb exploded inside his Mitsubishi Pajero. He was the only victim of the blast. His body lay on the side of the road covered in a white sheet before being carried away along with the remains of his vehicle.

Hezbollah confirmed Mughnieh’s death early yesterday morning.

“With all due pride, we declare a great jihadist leader of the Islamic Resistance in Lebanon joining the martyrs . . . The brother commander Haji Imad Mughnieh became a martyr at the hands of the Zionist Israelis,” said a statement carried by the Hezbollah al-Manar television channel. The station broke off normal program-ming to broadcast verses from the Koran interspersed with commentary and propaganda footage of Hezbollah fighters in action.

As the news spread, gunfire broke out in the Ain Dilb quarter of the Shia-dominated southern suburbs of Beirut, a ramshackle district beside the airport that was home to Mughnieh in the 1980s. By yesterday afternoon Mughnieh’s coffin had been transported to the southern suburbs of the city, where it lay in state draped in yellow Hezbollah flags, flanked by uniformed fighters, as mourners filed past.

“This is as big a blow as it gets for Hezbollah security. It’s even bigger than killing [the Hezbollah leader Sheikh Hassan] Nasrallah,” said Magnus Ranstorp, a Hezbollah specialist at the Swedish National Defence College in Stockholm.

Israel denied responsibility for Mughnieh’s death, although Israeli officials greeted the demise of their arch enemy with joy. Danny Yatom, former director of the Mossad intelligence agency, called the assassination “a great achievement for the free world in its fight against terror”.

A retaliation from Hezbollah is almost certain. When Israel assassinated Sheikh Abbas Mussawi, then the Hezbollah leader, in February 1992, the Israeli Embassy in Buenos Aires was blown up a month later, killing 29 people in a revenge operation alleged to have been planned by Mughnieh himself.

“This is something that Hezbollah cannot let pass. Mughnieh was too much of a symbol,” said Timur Goksel, a lecturer on international relations in Beirut and a former United Nations official in south Lebanon. “I don’t think Hezbollah will go for a big bombing, probably an assassination of a high-profile target.” Sheikh Afif Naboulsi, a prominent Hezbollah cleric in south Lebanon, told al-Manar television “Any attack against Hezbollah will be met with a response . . . an eye for an eye, a man for a man, a leader for a leader”.

Mughnieh’s death comes amid high tensions in Lebanon as the country prepares to mark the third anniversary of the assassination of Rafik Hariri, the former Prime Minister, in a Valentine’s Day lorry bomb blast in 2005.

Hezbollah is organising a large funeral for Mughnieh this afternoon, even as a huge turnout is expected in central Beirut to commemorate Hariri’s death. While Israel and the US top the list of suspects behind Mughnieh’s death, some Lebanese – especially those that oppose the Syrian regime – were quick to point a finger of blame at Damascus.

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