Europe's most-wanted war crimes fugitive — Ratko Mladic, who is wanted for the alleged massacre of thousands of Muslim men and boys — has been arrested in Serbia after years in hiding.

Serbian President Boris Tadic confirmed the arrest Thursday. "Today, we close one chapter of our recent history that will bring us one step closer to full reconciliation in the region," he said during a news conference in Belgrade. "All crimes have to be fully investigated, and all war criminals must face justice."

Mladic is alleged to have led the forces that attacked the Bosnian town of Srebrenica, a UN-declared safe area, in the summer of 1995. In early July that year, more than 8,000 Bosnian Muslim men and boys were executed by Serbian forces, and the town's women and children were driven out of the area.

Ratko Mladic, in baseball cap, enters court in Belgrade, Thursday. ((Serbian government/Associated Press))

Just hours before the massacre, Mladic handed out candy to Muslim children in the town's square, assuring them everything would be fine and patting one child on the head. Then the shootings began and the bodies of the victims were bulldozed into mass graves.

Since the massacre, the bodies of thousands of the victims have been recovered, identified through DNA tests and laid to rest.

Mladic has been on the run since 1995, when he was indicted by the UN war crimes tribunal in The Hague.

Prosecutors had complained that Serbia was not doing enough to bring Mladic to justice.

Tadic stressed that the arrest was the result of full co-operation of Serbia with the Hague tribunal.

Mladic, 69, faces life imprisonment if tried and convicted of genocide and other charges.

Frail appearance

Mladic appeared Thursday evening at a closed session in a Belgrade court, looking frail and walking very slowly as he was escorted by four guards in the first step of the extradition process. He wore a navy-blue jacket and a baseball hat with grey hair sticking out the sides, and carried what appeared to be a towel in his left hand.

Mladic, Karadzic may be tried together The arrest of Ratko Mladic could become a factor in the UN trial of Radovan Karadzic, the alleged mastermind of Bosnian Serb atrocities during the 1992-95 war, Karadzic's defence lawyer says. Attorney Peter Robinson said that Karadzic's trial in The Hague is only about 20 per cent completed. He said judges may decide to try Mladic and Karadzic together. Robinson told The Associated Press on Thursday that Karadzic's defence team must decide whether to continue the trial or to seek a halt and work with Mladic's defence team. Karadzic was captured nearly three years ago, in disguise on a bus in Belgrade, the Serbian capital. The former Bosnian Serb leader is the highest-profile figure brought before the Yugoslav war crimes tribunal since former president Slobodan Milosevic, who died before his trial ended.

He could be heard on state TV saying "good day" to someone in the court. A guard could be heard telling him, "Let's go, general."

Mladic's lawyer said the judge cut short the questioning because the suspect's "poor physical state" left him unable to communicate. Attorney Milos Saljic said Mladic asserts that he will not answer to the authority of the U.N. war-crimes tribunal in the Netherlands.

"He is aware that he is under arrest, he knows where he is and he said he does not recognize The Hague tribunal," Saljic said.

Mladic's arrest removed the most important barrier to the Western-leaning Serbian government's efforts to join the European Union and to rehabilitate the country's image as a pariah state that sheltered the men responsible for the worst atrocities of the Balkan wars of the 1990s.

Mladic had two pistols when he was arrested but offered no resistance, and he appeared shrunken and pale, Serbian officials and media said. Serbia raised its national security level and banned all gatherings after nationalist groups pledged to pour into the streets in protest.

Mladic hiding at home of relatives

Prosecutors have said they believed Mladic had been hiding in Serbia under the protection of hardliners who consider him a hero.

Belgrade's media said Mladic was arrested Thursday in Lazarevo, a village some 100 kilometres northeast of Belgrade close to the northern Serbian town of Zrenjanin.

Belgrade's B-92 radio said Mladic was not in disguise when arrested, unlike wartime Bosnian Serb president Radovan Karadzic who was arrested in Belgrade in 2008 disguised as a New Age guru, with long white hair and a beard.

Bosnian Muslim Hatidza Mehmedovic gestures near the gravestone of her relative, victim of the Srebrenica massacre, at the Potocari memorial centre near Srebrenica, Bosnia, on Thursday. ((Amel Emric/Associated Press))

Rasim Ljajic, a government minister in charge of co-operation with the UN tribunal, said "Mladic looked like an old man" when he was arrested. He had lost all of his hair.

"One could pass by him without recognizing him," Ljajic said. "He was pale, which could mean he rarely ventured out of the house, a probable reason why he went unnoticed," he said. Ljajic said said Mladic had two handguns in his possession, but did not resist the arrest and "was co-operative."

Belgrade B-92 radio said one of Mladic's arms was paralyzed, probably the result of a stroke. Serbian state TV said Mladic was bald and appeared "worn out." Local media reported he had been living under the name Milorad Komadic.

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Tadic said the process to extradite Mladic to the tribunal in The Hague is underway. Justice officials said it will take at least a week before he is handed over.

The Serbian president also vowed to do everything to arrest another fugitive, Goran Hadzic, and deliver him to the war crimes tribunal. Tadic said it was "crystal clear" that Hadzic can't hide forever.

Croatian media broke the news of the arrest of Mladic. They reported that Croatian police were told by their Serbian counterparts that DNA analysis confirmed the fugitive's identity. Belgrade's B92 radio said Mladic was detained earlier Thursday in a village near the northern Serbian town of Zrenjanin.

In Bosnia, the head of a group of of victims' family members formed to keep the pressure on war crimes investigators to find the bodies and to arrest the perpetrators, welcomed the arrest. But, added Munira Subasic, "I'm sorry for all the victims who are dead and cannot see this day."

War crimes tribunal judge Fouad Riad said during Mladic's 1995 indictment in absentia that the court had seen evidence of "unimaginable savagery: thousands of men executed and buried in mass graves, hundreds of men buried alive, men and women mutilated and slaughtered, children killed before their mothers' eyes, a grandfather forced to eat the liver of his own grandson."

"These are truly scenes from hell, written on the darkest pages of human history," he said.

But even as Balkan war-crimes fugitives such as Karadzic and Slobodan Milosevic were brought to The Hague, Mladic was idolized and sheltered by ultranationalists and ordinary Serbs despite a 10 million euro ($14 million) Serbian government bounty, plus $5 million offered by the U.S. State Department.

He was known to have made daring forays into Belgrade to watch soccer games and feast on fish at an elite restaurant.

In a particularly brazen touch, he had been using the alias Milorad Komadic, an anagram of his true identity, police said.

Supporters of Ratko Mladic chant songs and wave Serbian flags at a protest against Mladic's arrest in central Belgrade, Thursday. ((Marko Drobnjakovic/Associated Press) )

Before sunrise, agents of Serbia's domestic intelligence agency moved quietly on Mladic's hideout, a single-story yellow brick house owned by a relative of the fugitive's mother, said Radmilo Stanisic, the de facto mayor of Lazarevo, a village of some 2,000 residents about 100 kilometres northeast of Belgrade.

"They didn't even wake us up," said a resident who identified himself only as Zoran. "I'm furious. They arrested our hero."

The nationalist Serbian Radical Party said Mladic was a "hero" and described his seizure as "one of the hardest moments in Serbian history."

The extreme-right group 1389 said the arrest was "a treason" and called on citizens to pour into the streets and protest.