Journalist Jamal Khashoggi was killed in a fight in the Saudi consulate in Istanbul, the country’s state TV reports, quoting an initial inquiry.
Deputy intelligence chief Ahmad al-Assiri and Saud al-Qahtani, senior aide to Crown Prince Mohammed Bin Salman, were sacked over the affair, it says.
US President Donald Trump said what had happened was “unacceptable” but added that Saudi Arabia was a “great ally”.
This is the first time the kingdom has admitted Mr Khashoggi is dead.
The acknowledgement follows two weeks of denials that Saudi Arabia had any involvement in the disappearance of the prominent Saudi critic when he entered the consulate in Istanbul on 2 October to seek paperwork for his forthcoming marriage.
The Saudi kingdom had come under increased pressure to explain Mr Khashoggi’s disappearance after Turkish officials said he had been deliberately killed inside the consulate, and his body dismembered.
Observers are questioning whether Riyadh’s Western allies will find the Saudis’ account of a “botched rendition” convincing – and whether it will persuade them not to take punitive action against Saudi Arabia.
The UK Foreign Office said it was considering its next steps after hearing the report.
The Saudi leadership will now be hoping that its belated admission that Khashoggi did die, after all, inside its consulate – coupled with a handful of sackings and arrests – will be enough to draw a line under this affair. It will not.
This is only a first step towards publicizing the truth of what really happened. Given the days of indignant denials by the Saudi leadership it’s doubtful we would have even got this far without sustained international pressure
There can only be one of two possible alternatives here: either – as many suspect – the powerful Crown Prince Mohammed Bin Salman was to blame or he had lost control of his inner circle, something most observers find hard to believe.
MBS, as he is known, has a huge following amongst young patriotic Saudis who see him as a visionary reformer. If that support were now to ebb away then the crown prince could find himself dangerously isolated at court.