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Mexico's defense ministry said El Mencho was injured during an operation to capture him in the state of Jalisco.
He died while being airlifted to Mexico City.
At the same time, members of his cartel have unleashed violence across the state.
In Guadalajara and Puerto Vallarta, armed men have set cars and businesses on fire.
El Mencho's death now leaves a power vacuum in Mexico, and that is usually followed by intense violence.
Ada Peralta, NPR News, Mexico City.
Nemesio Oseguera Cervantes was better known as El Mencho, and he turned the Jalisco New Generation cartel into one of the most powerful organized crime groups in the world.
The US was offering a $15 million bounty for El Mencho, accusing his cartel of making billions of dollars by shipping fentanyl and cocaine to the US.
Mexico's defense ministry said El Mencho was injured during an operation to capture him in the state of Jalisco.
He died while being airlifted to Mexico City.
At the same time, members of his cartel have unleashed violence across the state.
In Guadalajara and Puerto Vallarta, armed men have set cars and businesses on fire.
El Mencho's death now leaves a power vacuum in Mexico, and that is usually followed by intense violence.
Eric Peralta, NPR News, Mexico City.
President Trump declared a national emergency and cited drug trafficking as a reason to place 25% tariffs on Mexico.
The Supreme Court said that was unconstitutional.
But Mexican economists say the effect may be limited because Trump had also issued exemptions.
About 80% of Mexican exports to the U.S.
are not subject to any taxes.
Where the Supreme Court decision might have a big effect is on an executive order Trump issued on Cuba.