Luke Somers was shot by his captors during a raid and later died, a US official told the New York Times.
His sister, Lucy Somers, told the Associated Press that she had been notified by the FBI of his death.
UK-born Mr Somers, who was kidnapped in Yemen in 2013, had appeared in a video appealing for help.
Yemen's defence ministry confirmed a "major operation" had taken place in Yemen's southern Shabwa province on Saturday.
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