A wealthy Serbian paramilitary leader, famous for organizing the slayings of ethnic Croats, Muslims and Albanians, was shot dead today in a fashionable hotel in the Yugoslav capital by at least two masked assailants, according to witnesses and official news reports in Belgrade.

Zeljko Raznatovic, widely known as Arkan, was an ally of President Slobodan Milosevic and led one of the country's notorious nationalist paramilitary groups during the 1992-95 war in Bosnia and the war in Kosovo last spring. He had been a wanted figure in the West since 1997, under a secret arrest warrant issued by the international war crimes tribunal in The Hague.

No one claimed responsibility for the late afternoon machine-gun slaying, which occurred as Arkan sat in the lobby of the Intercontinental Hotel--a comfortable haven for the dwindling number of wealthy businessmen in Yugoslavia's impoverished economy. Tanjug, the official state news agency, said that "masked attackers opened fire from automatic weapons in the direction of Arkan and then ran off."

He was shot at least three times in the head and died on the way to the hospital, authorities said. The gunmen, who escaped before police arrived, also killed two of Arkan's bodyguards and injured several passersby, according to wire service reports.

The United States derived no satisfaction from Arkan's death, Secretary of State Madeleine K. Albright said today.

"We take no satisfaction in Arkan's murder and would have wanted him to stand trial in The Hague for his crimes," she said in a statement released during a visit to Panama.

Arkan, 47, was perhaps the best known of the handful of Serbs who have commanded private armies that dabbled equally in war, organized crime, legitimate businesses and political string-pulling. A convicted bank robber allegedly hired by the Yugoslav secret police to help liquidate state enemies overseas, Arkan rose to prominence as the leader of men believed responsible for ethnic cleansing and the murder of thousands of people in the Bosnian towns of Bijeljina, Zvornik, Brcko, and Bratunac in 1991 and 1992.

Milosevic sponsored his election to parliament as a Kosovo legislator in 1992, as the state-run media controlled by the president lauded Arkan's "heroism" in Muslim areas. Milosevic repeatedly rebuffed Western complaints about Arkan and once told former U.S. ambassador to Yugoslavia Warren Zimmerman that, "as I understand it, he is no more than a simple sweet shop owner," referring to Arkan's ownership of a Belgrade ice cream parlor.

Arkan's soldiers were known as the Tigers, and according to a December report by investigators with the Organization for Security and Cooperation in Europe (OSCE), they committed atrocities in Kosovo between last March and July. Early reports of their activities in the Kosovo war prompted Louise Arbour, then the chief prosecutor of the tribunal, to reveal that he had been indicted as a war criminal.

According to Western intelligence reports and other evidence, Arkan's men had established a training camp north of the Kosovo city of Mitrovica, and mostly operated near that city, as well as Pec, Prizren, and Djakovica, wearing their trademark black uniforms. The Tigers' reputation for savagery was so well known that Yugoslav army soldiers occasionally spread the rumor among ethnic Albanians of their imminent arrival as a way of compelling the population to flee, the OSCE report said.

Arkan's take-no-prisoners style of enforcing Serbian hegemony over Yugoslav land made him a hero to many Serbs, helped him become a social lion in Belgrade and paved the way for him to amass one of the country's largest fortunes.

His holdings included Obilic, the country's premier soccer team that competes regularly in top European leagues; a chain of bakery stores; and, before the war last summer, part ownership of Kosovo properties such as Pristina's Grand Hotel. He also was allegedly involved in black-market currency trading and arms and gasoline smuggling. His wife, Svetlana, better known as Ceca, was one of the country's most popular folk singers and a frequent television performer. At their wedding, he dressed in a World War I general's uniform.

It was the brutal slaying by Arkan's men of 250 Croats who were dragged from a hospital in the city of Vukovar in 1991 that eventually led to his indictment for crimes against humanity and grave breaches of the Geneva conventions and other laws governing the conduct of war. In an April 1999 NBC-TV interview, he denied that he had operated as a mercenary and said that his army had "been under the command of the Yugoslav army in that time."

During the Kosovo war, he lived in the Hyatt Hotel, next door to the Intercontinental, apparently believing that NATO bombers would not strike a building where foreign journalists were staying. A spokesman for a government prosecutor in Belgium, where Arkan's daughter lives, said in July that Arkan's lawyer had informally requested asylum for the paramilitary leader. But Belgian authorities spurned the request, pledging to arrest him on outstanding German warrants, stemming from his alleged involvement in killings, jewel robberies, and other crimes committed during the 1980s.

"Even in the former Yugoslavia, Arkan was something special," U.S. ambassador to the U.N. Richard C. Holbrooke said in his memoir on the Bosnian war. "When I mentioned Arkan's name to Milosevic, he seemed annoyed; he frowned and his eyes narrowed."

CAPTION: The Serbian paramilitary leader known as Arkan was wanted on charges of crimes against humanity.