Al-Qaeda militants have beheaded an American engineer they were holding hostage in Saudi Arabia.
Mr Johnson's wife pleaded for his release on Arabic TV
Graphic photographs apparently showing the corpse of Paul Marshall Johnson, who was abducted in Riyadh last week, have appeared on an Islamist website.
A Saudi official said the body of Mr Johnson, 49, had been found in a remote area north of the capital, Riyadh.
President George W Bush condemned the beheading, saying it "shows the evil nature of the enemy we face".
Meanwhile, reports from Saudi Arabia say the head of al-Qaeda in the country, Abdul Aziz al-Muqrin, has been killed by Saudi security forces.
Muqrin and two other militants died in a shootout in Riyadh's al-Malaz district following discoveries at the house where Mr Johnson's body was found.
The militant had claimed to be involved in the beheading of Mr Johnson, and in the killing of other westerners based in Saudi Arabia.
'Killed in cold blood'
Al-Qaeda had told the Saudi government to free jailed Islamist militants by Friday, or it would kill Mr Johnson.
"They killed him in cold blood," Mr Bush told reporters in Seattle.
"They're trying to intimidate America. They're trying to shake our will. They're trying to make us retreat from the world."
Al-Qaeda is trying to terrify all Westerners into leaving Saudi Arabia as part of efforts to destabilise the Saudi rulers by weakening the economy which depends on foreign labour.
The BBC's Heba Saleh, in Cairo says that as the graphic images show, the group is showing itself adept in using the internet and the media to drive home its chilling message.
Photographs of the beheading were published on a website which has carried Islamist messages in the past.
Mr Johnson was dressed in an orange jumpsuit, a reference to Guantanamo Bay
A statement on the site signed by the "Organisation of al-Qaeda in the Arabian Peninsula" claims responsibility for the killing.
"As we promised the mujahideen, we have beheaded the American hostage Paul Marshall after the deadline that the mujahideen gave to the tyrannical Saudi government passed," it says.
"This is God's voice raising in anger... at the treatment of Muslims in Abu Ghraib... Guantanamo and others," the statement adds.
The corpse on the website is dressed in an orange jumpsuit similar to those worn by prisoners held at the US detention centre in Guantanamo Bay, Cuba.
Al-Qaeda, the statement says, had killed Mr Johnson because of "what Muslims have suffered from American Apache helicopters and their rockets".
Mr Johnson had been working as a helicopter engineer for US defence contractor Lockheed Martin in Saudi Arabia.
The killing came despite pleas for mercy from Mr Johnson's family broadcast in the Arab world.
His son had said his father was simply doing his job and begged the kidnappers to set him free for Fathers' Day this weekend.
On Friday, Islamic religious leaders had warned the kidnappers against the use of violence.
Sheikh Saleh bin Abdullah bin Humaid told worshippers at the Great Mosque in Mecca that hostage-taking and murder were grave sins under Islam.
Saudi authorities had stepped up their efforts to find Mr Johnson as the deadline loomed. Some 15,000 security officers swept through Riyadh, going from door to door in some areas and visiting about 2,000 sites.
In May, kidnappers linked to al-Qaeda beheaded a 26-year-old American in Iraq, placing the images of the beheading on an Islamist website.