Aug 27 (Agencies): A fugitive British hacker who had become one of Islamic State’s top online terrorist recruiters was killed by a U.S. drone strike in Syria on Tuesday, two people familiar with the operation said, indicating the U.S.-led campaign is continuing to penetrate the extremist network’s leadership.

Junaid Hussain was convicted in 2012 of hacking the email of a former aide to British Prime Minister Tony Blair and publishing Mr. Blair’s personal details online.

Shortly after he was released from prison, he fled the country and went to Syria, according to an official familiar with the situation.

Mr. Hussain quickly became a top computer engineer for Islamic State, working as a hacker and using social media and encrypted technology to try to recruit Americans to carry out domestic attacks, said people familiar with the pursuit of Mr. Hussain.

He was on the leading edge of Islamic State’s efforts to recruit people in the U.S.—so-called lone-wolves—who could be driven to kill U.S. service members, these people said.

He often posted the names, addresses and photos of U.S. troops on his Twitter feed and urged his followers to find the person and kill him or her, said a person familiar with the hunt for Mr. Hussain.

In several of those instances, the Federal Bureau of Investigation and Defense Department had to guard targeted service members around the clock, the person said.

Mr. Hussain was killed by what’s known as a “targeted” strike, meaning officials had pinpointed his precise location near the Syrian city of Raqqa, people familiar with the matter said.

It is unusual, but not unprecedented, for U.S. and British citizens who turn to terrorism to be killed in drone strikes. Officials from the U.S. and U.K. met several months ago and decided that Mr. Hussain should be tracked down, one person familiar with the process said.

The two countries had worked closely on tracking the British national, and both gathered evidence for criminal cases in the event they should apprehend him.

The U.S. government has conducted drone strikes against Islamic State leaders and soldiers for more than a year, but recently stepped up those efforts after reaching an agreement to conduct strikes out of a base in southern Turkey.

It is unclear if the drone strike that killed Mr. Hussain was flown out of Turkey or another location.

While U.S. officials consider the strike against Mr. Hussain a major success, their campaign against Islamic State militants in Syria, Iraq, and other areas has proved much more difficult than initially estimated. Islamic State militants still control large areas in Syria and Iraq, and efforts to push the group out of the Iraqi cities of Ramadi and Mosul repeatedly have been postponed.

Mr. Hussain, however, was less well-known for his accomplishments within those areas and more worrisome to U.S. and British officials for his attempts to provoke deadly attacks outside them.

U.S. officials were on high alert for terror attacks around the July 4 holiday this summer. Mr. Hussain was believed to have been involved in helping to inspire some of those planned attacks, which the FBI said it had thwarted.

The FBI and other law enforcement agencies have made numerous arrests in recent months that they said were tied to those planned attacks, officials said, though they have kept some information secret as several of the investigations remain open.

Mr. Hussain made a rapid transition from his roots in Britain into one of Islamic State’s leading militants. Before graduating from high school, he joined a group of other British teens in a hacking collective called Team Poison.

Establishing an online hacker handle called “Trick,” Mr. Hussain and his collective claimed responsibility for a number of significant breaches, including hacking into the Scotland Yard telephone system.

Team Poison said it listened in on a phone conversation between U.K. and U.S. investigators discussing the need to fight hackers. The group published the phone call online on YouTube.

In 2012, at age 17, Mr. Hussain was tried and convicted of hacking offenses, but U.K. law-enforcement officials at the time considered him more of a bored youth who had broken the law for his own amusement, rather than a budding terrorist, according to officials and a police report on Mr. Hussain.

When Mr. Hussain left prison in 2013, he moved toward more violent activity, authorities said.

Just months after he regained his freedom, police arrested him for an alleged violent-disorder offense. There have been no further details released about that alleged crime.

Shortly after receiving bail for that incident, he fled to Syria, a person familiar with the situation said