The leader of the Gulf drug gang has been captured in a blow to the criminal groups that have terrorised Mexico for years.
The interior ministry said that soldiers captured Mario Ramirez Trevino, described as "the head of a criminal organisation that operated in the north of the country", in an operation on Saturday.
It is the second major success against the drug gangs for President Enrique Pena Nieto after the arrest last month of Miguel Angel Trevino, the head of the paramilitary Zetas cartel.
Pena Nieto, who took office in December last year, has pledged to reduce drug-related violence that has resulted in more than 70,000 murders since 2006.
Ramirez Trevino was captured in Rio Bravo, a town on the border with Texas, according to a justice source in the northeastern state of Tamaulipas. Mexican military helicopters buzzed across the region.
The United States had offered a US$5 million reward for information leading to Ramirez Trevino's arrest.
He has been charged with several US federal offences, including facilitating the trafficking of cocaine and marijuana shipments from Mexico into the US.
Ramirez Trevino, thought to be 51, became head of the once-powerful Gulf gang after its former leader, Jorge Eduardo "El Coss" Costilla, was arrested in September last year.
Reportedly a former drug addict, Ramirez Trevino rose to lead the Gulf group that controlled criminal activities in the key smuggling town of Reynosa, across the Rio Grande river from McAllen, Texas.
In recent months he reportedly asserted his leadership over the Gulf organisation by crushing a rival faction.
The Gulf cartel originally hired the Zetas, who are elite anti-drug commandos who deserted and turned to crime, to work as their enforcement arm. But the Zetas turned on their employers in 2010 and in a series of bloody turf battles took over most of their territory.
The Zetas now battle the western Sinaloa Federation for control of the major drug trafficking routes to the US.
The Sinaloa gang is headed by Joaquin Guzman, Mexico's most wanted man.