PESHAWAR, Pakistan (AFP) - A United States drone strike on Friday killed Pakistani Taleban commander Hakimullah Mehsud, security and insurgent sources said, dealing a major blow to the militant network and casting doubt over proposed peace talks.

Mehsud's death is likely to prompt revenge attacks by the Taleban and disrupt government efforts to begin negotiations, analysts said, but will also seriously weaken an outfit that has become one of the greatest security threats to Pakistan.

It also represents a success for the CIA's drone programme targeting suspected militants in Pakistan's tribal belt at a time when it is under intense scrutiny over civilian casualties.

Mehsud, who had a US$5 million (S$6.2 million) US government bounty on him, died along with three others when a US drone fired two missiles at a vehicle in a compound in the village of Dandey Darpakhel, 5km north of Miranshah, the main town of North Waziristan, officials said.

North Waziristan is one of seven semi-autonomous tribal regions along the Afghan border, which Washington considers to be a major hub of Taleban and Al-Qaeda militants plotting attacks on the West and in Afghanistan.

Security and intelligence officials confirmed the death while a senior Taleban source said Mehsud, who was thought to be aged 34, was killed along with his bodyguard, driver and uncle. Another Taliban commander said the funeral would be held on Saturday.

It is the second significant blow to the Tehreek-e-Taleban Pakistan (TTP) in a month, following the capture of another senior commander by US forces in Afghanistan.

Security expert Rahimullah Yusufzai told AFP it was unclear whether the TTP has anyone in its ranks capable of filling the gap left by the charismatic Mehsud.

"His death will weaken the movement. Although they will soon appoint a new chief it is to be seen how effective the new person will be in controlling things," Yusufzai said.

"They will certainly try to take revenge and in this process, they will harm themselves and will cause problems for the government also." After a bloody six-year TTP insurgency which has left thousands of soldiers, police and civilians dead, the government has been edging towards talks with the militants.

Mehsud's death came just a day after the government said the "process of dialogue" with the Taliban had started but no formal talks had taken place. The militants said they had had no contact from the government.

Saifullah Khan Mehsud of Islamabad's FATA Research Centre, an expert on Pakistan's tribal belt, said the killing of the Taleban commander would disrupt the peace process in the short term but could ultimately prove beneficial.

"Hakimullah was a very divisive figure, a very hated figure, a very controversial figure - he was the one who represents in the eye of the Pakistani public everything that is evil about TTP," he told AFP.

"Of course for the time being there will be perhaps... a call for an end to the dialogue process, but in the long run a divisive figure like Hakimullah Mehsud not being there will make the environment more conducive for peace negotiations."

Mehsud took control of the TTP after a bitter fight for the leadership following the death of founder Baitullah Mehsud in a drone strike in August 2009. Hakimullah Mehsud was widely reported to have been killed in 2010 but later resurfaced.

Seen as a hardliner, he oversaw some of the TTP's most high-profile attacks including the attempt to kill schoolgirl education activist Malala Yousafzai in October last year.

The United States charged him with terrorism after seven Americans were killed in a suicide attack at a CIA base in Afghanistan in December, the deadliest attack on the agency since 1983.

Since 2004, the United States has carried out hundreds of missile attacks from unmanned aircraft targeting suspected Taleban and Al-Qaeda linked militants in the tribal areas.

The number and identity of casualties is hard to determine as the tribal areas are off limits to foreign journalists and aid organisations, but the London-based Bureau of Investigative Journalism estimates deaths at between 2,500 and 3,700.

Hundreds of civilians have died in the attacks, according to various estimates, prompting outrage in Pakistan and abroad.

A major report last week from rights campaigners Amnesty International said the US may be guilty of war crimes, highlighting two attacks which it said appeared to kill only civilians.

The Pakistani government officially condemns drone strikes as a violation of its sovereignty and last week Sharif urged US President Barack Obama to halt the programme during a meeting in Washington.

Despite their deep unpopularity in Pakistan, the US sees them as a vital tool in the fight against militants in the lawless tribal areas.

As well as Hakimullah and Baitullah Mehsud, TTP number two Waliur Rehman and Al-Qaeda deputy leader Abu Yahya al-Libi were also killed in drone attacks in Pakistan.