The secret serviceman is said to have infiltrated a violent mob mutilating the captured Libyan leader last year and shot him in the head, the Daily Mail reported.
The daily quoted Libyan sources as saying that the motive was to stop Gaddafi from being interrogated about his "highly suspicious" links with Sarkozy.
Former British prime minister Tony Blair was also extremely close to Gaddafi, visited him regularly and helped facilitate business deals worth millions of pounds.
Sarkozy, who once welcomed Gaddafi as a "brother leader" during a state visit to Paris, was said to have received millions from the Libyan to fund his election campaign in 2007, the daily said.
Mahmoud Jibril, who served as interim prime minister following Gaddafi's ouster, told Egyptian TV: "It was a foreign agent who mixed with the revolutionary brigades to kill Gaddafi."
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