Velazquez Caballero has been fighting a bloody internal battle with top Zetas' leader Miguel Angel Trevino Morales, and officials have said the split was behind a recent surge in massacres and shootouts, particularly in northern Mexico.
"A person who is presumed to be, and acknowledges being, Ivan Velazquez Caballero, was captured in the state of San Luis Potosi" in north-central Mexico, the navy said in a statement on Wednesday.
Officials were presenting Velazquez Caballero to the media Thursday morning.
Also known as "Z-50," Velazquez Caballero has a 30 million peso ($2.3 million) reward on his head.
If confirmed, Velazquez Caballero's arrest could calm some of the brutal violence that has hit border cities like Nuevo Laredo, across from Laredo, Texas, in recent weeks.
On Sept. 14, eight men were found shot to death and one hanging from a bridge in Nuevo Laredo, territory traditionally controlled by Trevino Morales, alias "Z-40." Analysts say 14 bullet-ridden bodies stuffed in a van in mid-August in San Luis Potosi were men loyal to "El Taliban," and may have been left there as a warning by Trevino Morales' underlings.
Discussing recent fighting, a U.S. official in Mexico who could not be named for security reason said earlier this week that "I think right now the uptick that I'm seeing is between `40' and `50'," referring to Trevino Morales and Velazquez Caballero by their "Z" aliases.
The Zetas cartel takes its name from a police radio code in which "Z" means "commander," and a number refers to rank.
The official said Velazquez Caballero appeared to have formed an alliance of convenience with the Knights Templar cartel based in southern Michoacan state for his fight with Trevino Morales.
Banners signed by various elements of the Zetas and hung from overpasses in several Mexican states appeared to confirm mutual hatred between Trevino Morales and Velazquez Caballero. In the obscenity-laden banners, the two capos accused each other of betraying their fellow traffickers and preying on civilians.
If the man arrested as "El Taliban" is confirmed, the development could strengthen Trevino Morales, who shares leadership of the Zetas with Heriberto Lazcano, alias "El Lazca."
The U.S. official played down recent speculation that Trevino Morales and Lazcano had also fallen out.
"I'm not familiar with a fight between him (Trevino Morales) and Lazca," the official said. "I think he and Lazca -- Lazca is doing his thing and he is doing his, and they're still together from what I understand."
Lawmen and even competing drug capos picture Trevino as a brutal assassin who favors getting rid of foes by stuffing them into oil drums, dousing them with gasoline and setting them on fire, a practice known as a "guiso," a Spanish word for "stew."
The Zetas are already considered the hemisphere's most violent criminal organization. They have been blamed for a large share of the tens of thousands of deaths in Mexico's war on drugs, though other gangs also have repeatedly committed mass slayings.
Running gun battles between Navy personnel and gunmen broke out late Wednesday in the border city of Piedras Negras, across the border from Eagle Pass, Texas.
Officials in the border state of Coahuila confirmed the shootouts, and state security spokesman Sergio Cisbeles said the confrontation was serious, but he could not immediately confirm whether there anyone was wounded or dead.
The Zetas have been known to be active in Coahuila state, but it was unclear whether the confrontations in Piedras Negras were related in any way to the capture of Velazquez Caballero.
