Mustafa Setmarian, 48, a Syrian with Spanish citizenship, was captured in Pakistan in October 2005 and is held in a prison operated by the US Central Intelligence Agency, Pakistani and European security service officials told El Pais.
A spokesman for the US embassy in Spain declined to comment on the report.
Setmarian's 2005 capture was reported in May of this year after the United States put a $5 million bounty on the head of the alleged founder of al Qaeda's Spanish network.
A photograph of the red-haired Setmarian has been removed from the US Federal Bureau of Intelligence's most-wanted Web page.
Pakistan has not answered requests from Madrid about the whereabouts of Setmarian, wanted in Spain for allegedly training Sept. 11 hijackers in Afghanistan and ordering Madrid commuter train attacks that killed 191 people, according to El Pais.
Spain's high court is unable to request his extradition as he has not been officially imprisoned, the newspaper reported.
Spanish high court officials were not immediately available to comment.
Spanish judge Baltasar Garzon in June complained US officials were concealing information on his whereabouts.
Amnesty International has reported Setmarian's disappearance. The human rights organisation says dozens of Islamic radicals captured in Pakistan are held in clandestine jails operated by the United States and other countries.
Setmarian is married to Elena Moreno, a Spanish woman who says he is held in a secret CIA jail.

Copyright Reuters, 2006