A second 'Prisoner X' was being held in top-secret conditions in the same jail where an Israeli-Australian spy took his his own life in 2010, an Israeli newspaper has reported.

Court documents cited by Haaretz newspaper said the prisoner was being held in another wing of Ayalon prison at the same time as Ben Zygier, an alleged Mossad spy whose mysterious arrest and subsequent suicide shocked Israel and Australia when it hit the headlines in February.

The documents show the second prisoner had already been convicted without saying what his crime was.

Avigdor Feldman, a lawyer who specialises in matters of national security and formerly advised Zygier, has told a radio station that he also knew about a second detainee.

Mr Feldman declined to elaborate other than to say he was male, Jewish, held Israeli citizenship, and had worked for the government's secret services.

Asked how the second detainee's alleged offences compared with Zygier's, Mr Feldman told Tel Aviv radio station 103 FM: "Without getting into details? Much more grave. Much more sensational. Much more amazing. Much more riveting."

The prisoner, who was being held under similar conditions to Zygier, was not named and it was not clear from the papers whether he was still incarcerated, Haaretz said.

Zygier, who was initially referred to as "Prisoner X" before the ABC identified him as an agent for Israel's shadowy Mossad spy service, was found hanged in a supposedly suicide-proof cell in Block 15 of Ayalon prison in December 2010, with Israel going to extreme lengths to cover up his existence and the reason for his imprisonment.

Haaretz said the second prisoner was being held in Block 13 and that like Zygier, his case was being handled by the Shin Bet internal security service and the prison's intelligence officers.

The paper said the information was included in an appendix to a transcript of hearings and decisions on the Zygier case, which was released by the Central District Magistrates Court following a Haaretz request.

In May the ABC, which broke the original story about 'Prisoner X' in February, revealed that Zygier had been arrested after unwittingly sabotaging a top-secret spy operation to bring home the bodies of Israeli soldiers missing in Lebanon.

AFP/Reuters/ABC