Asmatullah Shaheen was attacked on Monday as he drove through Dargah Mandi village near Miransha, the main town of the troubled North Waziristan tribal district.
Shaheen, who had a 10-million-rupee ($95,000) government bounty on his head, was a former interim chief of the Taliban terrorist group.
Three other Taliban members were also killed in the attack.
"Unknown attackers opened fire on Asmatullah Shaheen's car. He along with three associates died on the spot," a security official in Miranshah said.
The attackers fled the scene in a separate vehicle, the security official said.
No group has yet claimed responsibility for the killing, but a local security official blamed a rival militant group.
Shaheen was leader of the Bhittani tribe and also chairman of the Taliban's supreme council for more than two years. But a militant source close to Shaheen said he was removed from the post in December after developing several differences with some militant commanders.
Shaheen gained notoriety after claiming responsibility for a suicide attack on a procession in Pakistan's largest Karachi city which killed at least 43 people and wounded more than 100 in December 2009.
He was responsible for storming a paramilitary outpost in the northwestern district of Tank in 2011, killing one troop during the fighting and kidnapping 15. Eleven of the detainees were later executed while the rest escaped.
An intelligence official in Peshawar said Shaheen was also wanted for masterminding other attacks on Pakistan troops that included suicide attacks.
RA/SHI