Abu Musab al-Zarqawi, the Al Qaeda leader behind a spate of terror attacks and beheadings in Iraq, is reportedly wounded, The New York Times said quoting an Islamic website.

"Let everybody know that the injury of our leader is an honour and causes us to surround our enemy tighter," the statement translated by the Search for International Terrorist Entities Institute in Washington said. The institute monitors Islamic Web sites.

The statement in the "information section" of the group, Al Qaeda Organisation in the Land of Two Rivers, seemed to suggest as if Zarqawi has been badly hurt and that his supporters were possibly being prepared for his death, the paper said.

Zarqawi is the American military's "most wanted man" in Iraq with a $25 million bounty on his head.

In Baghdad, a US military spokesman, Lt. Col. Steve Boylan, was quoted as saying he could not judge the report's credibility. "We have no information on whether he's wounded or what the state of his health is," he told Reuters.

"He's still our number one target to be captured or killed and until that happens, the hunt is still on."

The US had announced May 6 that Zarqawi, who is in his late 30s, narrowly escaped capture Feb 20 between the towns of Hit and Haditha, in the Euphrates Corridor.