The Afghan government says the Taliban's spiritual leader, Mullah Omar, "died in April 2013 in Pakistan."
In a statement issued by the office of the president, the government said their report was based on "credible information."
The announcement comes just two days before the Taliban and the Afghan government hold a second round of peace talks in Pakistan.
"The government of Afghanistan believes that grounds for the Afghan peace talks are more paved now than before, and thus calls on all armed opposition groups to seize the opportunity and join the peace process," the Afghans said in the statement.
"Mullah Omar led the Taliban to victory over rival Afghan militias in the civil war that followed the withdrawal of Soviet troops. His alliance with al-Qaida leader Osama Bin Laden prompted the US-led invasion of Afghanistan in 2001, in the aftermath of the 9/11 attacks on New York and Washington.
"Mullah Omar has since been in hiding, with a $10m (£6.4m;€9m) US state department bounty on his head."
Earlier, a Taliban spokesman told Voice of America, a news service funded by the United States government, that Omar is "very much alive."
As we've reported, little is known about the one-eyed leader. Even when the Sunni Muslim cleric was the most powerful man in Afghanistan, he avoided Kabul and instead gave orders from his home in Kandahar.
"News of his death comes at a difficult time for the movement, which is deeply divided over whether to pursue peace talks with the Afghan government with the aim of ending the 14-year war," the Journal reports.