A Muslim leader seen as a major figure in efforts to end bloody fighting in Thailand's south has been shot dead, raising concern about the future of peace talks.

Imam Yacob Raimanee of the Pattani Central Mosque - the main house of Islamic worship in one of several violence-plagued southern provinces - was gunned down on Monday afternoon in the town of Pattani, police said.

The imam was one of those supporting the talks ... he was killed, so we are concerned. Paradorn Pattanatabut, National Security Council chief

The killing came despite an agreement between Thailand and Muslim rebels from the region to try to avoid bloodshed during the Muslim fasting month of Ramadan, which ends this week.

"I can say that this incident is worrying," National Security Council chief and lead peace negotiator Paradorn Pattanatabut told the AFP news agency. "The imam was one of those supporting the talks... he was killed, so we are concerned," he said.

The fighting in the Muslim-dominated region has claimed more than 5,700 lives since 2004, with bombings, shootings and even beheadings targeting those perceived as collaborating with the Thai state.

Rebel groups have never clearly stated their demands, but they are thought to want more autonomy or a separate state in a region that was part of a Malay sultanate until annexed by Thailand in 1909.

In recent months, talks between the Thai authorities and some rebel groups including the Barisan Revolusi Nasional have brought tentative hopes of peace.

Malaysia - which has hosted peace talks - announced on July 12 that the two sides had agreed to try to stem the unrest during Ramadan.

But after a period of relative calm, violence resumed in late July, with a spate of bomb and gun attacks in southern Thailand that left nine people dead including teachers and police officers.

Paradorn vowed that the talks will continue. "They are trying to frighten people - so we have to be patient and strong," he said.