Officials in Belgrade tonight denied reports that General Ratko Mladic, the Bosnian Serb army chief wanted for genocide, had been arrested.

General Mladic, 63, has been on the run for ten years since the UN war crimes tribunal indicted him on a long list of charges including genocide and crimes against humanity.

He is considered to be one of the tribunal's top two most wanted suspects, alongside Radovan Karadzic, the Bosnian Serbs' wartime president.

The first report of an arrest came from a Bosnian Serb television station which reported that General Mladic had been captured near Tuzla, in the northeast of the Bosnian Serb Republic near the Serbian border, and was being taken to a US airforce base to be transported to The Hague.

The Serbian state news agency Tanjug later reported that General Mladic, held responsible for the siege of Sarajevo and the 1995 massacre of 8,000 Muslim men and boys at Srebrenica in eastern Bosnia, had been picked up in Belgrade.

Serbian government officials denied both reports but a senior Serbian state security official told the Associated Press that General Mladic had indeed been located and authorities were negotiating his surrender. The official, who spoke on condition of anonymity, did not say where the general had been located.

General Mladic, a career officer in the Yugoslav National Army (JNA), first came to prominence when he was posted to head JNA forces around Knin in eastern Croatia at the start of the Balkan wars in June 1991.

He was quickly promoted and was sent to Sarajevo in April 1992 at the start of the Bosnian War, taking over the Bosnian Serbs' nominally independent army the following month. He was seen as the driving force behind both the siege of Sarajevo, in which at least 12,000 people died, and in the campaign of ethnic cleansing around Bosnia-Herzegovina.

General Mladic is wanted by the UN tribunal on a long list of charges including genocide, crimes against humanity and grave breaches of the Geneva Conventions. He has been at large since 1995 when he was indicted by the tribunal for his actions during the 1992-1995 Bosnian war, including overseeing the 1995 Srebrenica massacre.

Western powers have long accused Belgrade of failing to co-operate in the hunt for General Mladic and Mr Karadzic and the Serbian operation appears to be a direct attempt to avert an EU threat to talks with Belgrade on closer economic and political co-operation.

Earlier this afternoon, Vladeta Jankovic, adviser to Vojislav Kostunica, the Serbian Prime Minister, said that efforts to find General Mladic were "in full swing", although he said that he had no information about any arrest. "It might be a decisive moment, not only for the survival of the government, but for the future prospects of the state," he said.