He is said to have infiltrated a violent mob mutilating the captured Libyan dictator last year and shot him in the head.
The motive, according to well-placed sources in the North African country, was to stop Gaddafi being interrogated about his highly suspicious links with Sarkozy, who was President of France at the time.
Nicolas Sarkozy, France's former president, allegedly ordered the murder of former Libyan dictator Colonel Gaddafi
Other former western leaders, including ex British Prime Minister Tony Blair, were also extremely close to Gaddafi, visiting him regularly and helping to facilitate multi-million pounds business deals.
Sarkozy, who once welcomed Gaddafi as a 'brother leader' during a state visit to Paris, was said to have received millions from the Libyan despot to fund his election campaign in 2007.
The conspiracy theory will be of huge concern to Britain which sent RAF jet to bomb Libya last year with the sole intention of 'saving civilian lives'.
A United Nations mandate which sanctioned the attack expressly stated that the western allies could not interfere in the internal politics of the country.
Instead the almost daily bombing runs ended with Gaddafi's overthrow, while both French and British military 'advisors' were said to have assisted on the ground.
Now Mahmoud Jibril, who served as interim Prime Minister following Gaddafi's overthrow, told Egyptian TV: 'It was a foreign agent who mixed with the revolutionary brigades to kill Gaddafi.'
The paper writes: 'Since the beginning of NATO support for the revolution, strongly backed by the government of Nicolas Sarkozy, Gaddafi openly threatened to reveal details of his relationship with the former president of France, including the millions of dollars paid to finance his candidacy at the 2007 elections.'
One Tripoli source said: 'Sarkozy had every reason to try to silence the Colonel and as quickly as possible.'
The view is supported by information gathered by investigaters in Benghazi, Libya's second city and the place where the 'Arab Spring' revolution against Gaddafi started in early 2011.
Rami El Obeidi, the former head of foreign relations for the Libyan transitional council, said he knew that Gaddafi had been tracked through his satellite telecommunications system as he talked to Bashar Al-Assad, the Syrian dictator.
Nato experts were able to trace the communicatiosn traffic between the two Arab leaders, and so pinpoint Gaddafi to the city of Sirte, where he was murdered on October 20 2011.
Nato jets shot up Gaddafi's convoy, before rebels on the ground dragged Gaddafi from a drain where he was hiding and then subjected him to a violent attack which was videod.
In another sinister twist to the story, a 22-year-old who was among the group which attacked Gaddafi and who frequently brandished the gun said to have killed him, died in Paris last Monday.
Ben Omran Shaaban was said to have been beaten up himself by Gaddafi loyalists in July, before being shot twice.He was flown to France for treatment, but died of his injuries in hospital.
Sarkozy, who lost the presidential election in May, has continually denied receiving money from Gaddafi.
Today he was unavailable for comment, but is facing a number of enquiries into alleged financial irregularities.
VIDEO: THE MURDER OF GADDAFI - WARNING SOME SCENES COULD BE OFFENSIVE TO THE EYE - VIEW WITH CAUTION
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