Five suspected al-Qaeda members, including a commander with Chechen links and two soldiers, were killed in an army offensive against jihadists in the south, Yemeni officials said.
The defence ministry named the foreigner as Abu Islam al-Shishani, the second foreign jihadist reported killed last week.
"Four al-Qaeda fighters were killed and nine wounded" in clashes with soldiers in Abyan province, a military source on the ground said.
During fighting in the Sanaj region between Maajala and Wadi Dheiqa, an al-Qaeda bastion, "two soldiers were killed and four more wounded", the source said.
The defence ministry said Shishani was killed in Maajala.
The deaths come as the military presses its latest offensive against al-Qaeda in the Arabian Peninsula.
AQAP, regarded by the United States as the global jihadist network's most dangerous franchise, has been the target of an intensifying drone war this year that has killed dozens.
In a video posted online Saturday, the AQAP chief for southern Yemen, Jalal Belaid al-Marqashi, said the army offensive amounted to a "crusade" ordered by the United States.
News of Shishani's death came as officials blamed AQAP for a suicide bombing at an intelligence post that wounded two guards, and after gunmen killed an army officer in Aden.
On Friday, another AQAP leader, Qassem al-Rimi, threatened to strike any party involved in the drone campaign and denied that foreigners made up the bulk of the group's jihadists.
Shishani was killed "during military operations ... against terrorist elements in Abyan" province, said a statement posted on the defence ministry website 26sep.net 
He had reportedly fought against Russian forces in Chechnya before moving to Yemen to join AQAP, a merger of the network's Yemeni and Saudi branches.