Kotey and ElSheikh, along with Mohammed "Jihadi John" Emwazi and Aine Davis, gained worldwide notoriety for their beheadings and torture of ISIS hostages in Syria, including American journalists James Foley and Steven Sotloff and aid worker Abdul-Rahman Kassig.
Emwazi was killed in a 2015 air strike in Syria after a giant manhunt sparked by his beheading of USA and British hostages.
The defense official told Fox News that Kotey and El-Sheikh "are believed to have acted as guards and interpreters involved in ISIS' illegal captivity of Western hostages".
The American journalists James Foley and Steven Sotloff, as well as Abdul-Rahman Kassig, an aid worker are thought to be among their victims. Davis was arrested in Turkey in 2015.
DEATH SQUAD Aine Davis is in a Turkish prison
The British extremists were suspected of beheading more than 27 hostages after repeatedly beating and torturing them.
The Beatles have beheaded more than 27 hostages, according to United States authorities.
According to the US State Department, Kotey "likely engaged in the group's executions and exceptionally cruel torture methods, including electronic shock and waterboarding".
Kotey was also responsible for recruiting several British nationals to join the jihadis, the State Department said.
Kotey, a 34-year-old convert to Islam who grew up in west London, and 29-year-old Elsheikh, whose family fled to the United Kingdom from Sudan in the 1990s, were the only remaining members of the group still at large.
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