BEIRUT (AFP) - The Islamic State in Iraq and Syria (ISIS) group said in a video on Saturday it had beheaded a second Japanese hostage, drawing outrage from Tokyo and condemnation from Washington.

The claim was made in a video released online that included no mention of a Jordanian pilot also being held by ISIS, whom the militant group has also threatened to kill.

Japanese journalist Kenji Goto is seen kneeling next to a standing masked man who speaks with a British accent and blames the Japanese government for his "slaughter".

The man, dressed head-to-toe in black with his face covered, appears to be the same ISIS militant who has featured in the group's previous execution videos.

Mr Goto is dressed in an orange outfit similar to those worn by prisoners at the US-run prison in Guantanamo Bay, also in keeping with hostages in previous ISIS videos.

The executioner, who is standing against a mountainous background, addresses Japanese Prime Minister Shinzo Abe, saying the murder of Mr Goto would mark the beginning of "the nightmare for Japan".

Mr Goto's killing, he said, was the result of "reckless" decisions by the Japanese government.

The brief video ends with the image of a body dressed in orange with a decapitated head on top of it.

Mr Abe vowed to "never forgive terrorists" after news of the video broke early on Sunday morning in Japan.

"I am extremely angry about these heinous and despicable terrorist acts. We will never forgive terrorists," the Premier, who appeared on the verge of tears, told reporters.

"We will cooperate with the international community to make them atone for their crimes."

Mr Goto's distraught mother said she "can't find the words" to describe her son's death. "It's deplorable, but Kenji is gone," a sobbing Ms Junko Ishido told reporters.

"I can't find the words to describe how I feel about my son's very sad death."

Mr Goto's brother Junichi Goto said he had been holding out hope, "But that's not possible anymore," he was quoted as saying by public broadcaster NHK.

US President Barack Obama led international condemnation of the "heinous murder".

"Through his reporting, Mr Goto courageously sought to convey the plight of the Syrian people to the outside world," Mr Obama said.

A spokesman for UN chief Ban Ki Moon also condemned the "barbaric murder", and said the death "underscores the violence that so many have been subjected to in Iraq and Syria".

In Tokyo, a government spokesman said Japan was "extremely outraged" at the "heinous and despicable terrorist act".

And in Washington, National Security Council spokesman Bernadette Meehan said the United States strongly condemned the execution and was working to confirm the video's authenticity.

Tokyo and Washington said they were working to confirm the video's authenticity.

"But so far, there is no reason to doubt Goto's death," said Japanese Foreign Minister Fumio Kishida.

British Prime Minister David Cameron denounced the apparent killing as "a further reminder that ISIL is the embodiment of evil, with no regard for human life."

French President Francois Hollande also condemned the "brutal murder".

Officially pacifist Japan has long avoided getting embroiled in conflicts across the Middle East and is rarely the target of religious extremism. So the hostage crisis has been especially shocking for the country.

Many braved Tokyo's chilly streets to pick up the Yomiuri newspaper's special supplement about the Goto video.

"It's scary - they (the militants) are saying they'll target Japanese people now," said 21-year-old university student Kyosuke Kamogawa.

"That sends chills down my spine."

NEGOTIATIONS "DEADLOCKED'

The apparent execution came after Japan said negotiations to win Mr Goto's release in a prisoner exchange had stalled.

ISIS had vowed to kill Mr Goto and Jordanian pilot Maaz al-Kassasbeh by sunset on Thursday unless Amman handed over an Iraqi female militant.

On Saturday morning Abe had renewed orders for officials to maintain close cooperation with Jordan in a bid to secure Goto's release.

"The government has been working with the utmost efforts on the issue - I deeply regret that this is the result," Abe told reporters on Sunday.

But "Japan will never yield to terrorism... (and) is firmly resolved to fulfil its responsibility in the international community's fight against terrorism".

"It has become deadlocked," Deputy Foreign Minister Yasuhide Nakayama, who is leading Tokyo's emergency response in Jordan, told reporters in Amman late Friday, Japanese media reported.

ISIS had vowed to kill Mr Goto and Jordanian pilot Maaz al-Kassasbeh by sunset Thursday unless Amman handed over an Iraqi female extremist.

On Saturday morning Abe met Foreign Minister Fumio Kishida and Chief Cabinet Secretary Yoshihide Suga.

He renewed orders for officials to maintain close cooperation with Jordan in a bid to secure Goto's release.

'PROOF OF LIFE'

Jordan demanded evidence that the pilot, who crashed in Syria on Dec 24, was still alive before freeing would-be suicide bomber Sajida al-Rishawi, who is on death row. The latest video made no mention of Kassasbeh's fate.

Last week, ISIS claimed responsibility for the beheading of another Japanese man it had been holding, self-described contractor Haruna Yukawa, after the expiration of a 72-hour deadline during which the militants had asked Tokyo to pay a US$200 million (S$270 million) ransom.

Jordan has offered to free Rishawi, who was convicted for her part in triple-hotel bombings in Amman in 2005 that killed 60 people, if ISIS releases the pilot.

The government has been under heavy pressure at home and from Japan - a major aid donor - to save Kassasbeh as well as Goto.

On Thursday, government spokesman Mohammad al-Momani said Rishawi was still in Jordan and would only be released if ISIS gave it "proof of life".

ISIS had set the Thursday sunset deadline for Rishawi to be released at the Turkish border in return for Goto but there was no news of a swap by nightfall.

Friday morning Jordan's military said it was still awaiting proof that Kassasbeh was safe.

The pilot's father Safi Kassasbeh begged Amman to save his son's life "at any price".

"We believe in God and we will accept whatever he has in store for us," said Safi Kassasbeh.

Mr Goto's wife Rinko also broke her silence this week also to plead for her husband's return.

"My husband is a good and honest man who went to Syria to show the plight of those who suffer," she said.

"I beg the Jordanian and Japanese governments to understand that the fates of both men are in their hands."

ISIS has imposed a brutal version of Islamic law in territory it controls in Syria and Iraq and has executed since August two US journalists, an American aid worker and two British aid workers.