French jihadist Rachid Kassim, suspected of inspiring the attack on French priest Fr Jacques Hamel, was targeted in a coalition air strike near the Iraqi city of Mosul, but his death is not yet confirmed, France 24 reports.
"We are currently assessing the results of that strike and will provide more information when it becomes available."
In Paris, a high-ranking official involved in counter-terror operations told AFP on condition of anonymity there was not "absolute confirmation" of his death, but that the probability was high.
Kassim, who is in his 30s, is believed to have inspired an attack last year in which a senior French policeman and his partner were knifed to death and another in which an elderly priest's throat was cut.
He is suspected of using the encrypted Telegram app to direct attacks on France from IS-controlled territory in Iraq or Syria.
The black-bearded Kassim was seen in July in an IS propaganda video in which he praised the attacker in the Nice truck massacre that killed 86 people on the July 14 Bastille Day holiday.