Abu Sayed Orakzai, also known as Sad Arhabi, and 10 other ISIS fighters were killed last week in a US airstrike in Nangarhar province, according to provincial spokesman Attaullah Khogyani.
The strike was carried out by Afghan and coalition forces after receiving intelligence from Afghanistan's National Directorate of Security, Khogyani said.
Army General Scott Miller, commander of US and NATO forces in Afghanistan, said: "America and her allies are in Afghanistan to maintain pressure on the networked, trans-regional terrorists attempting to plot, resource and direct attacks from here.
"This is only part of the coalition's work towards an Afghan security solution, but it is a vital part."
Following the confirmation of the ISIS leader's death, General Miller officially assumed command of the NATO-led forces at a ceremony in Kabul on Sunday, NATO announced.
He took over the role from Army Gen. John Nicholson.
The fall of the ISIS leader Orakzai leaves hopes for peace talks in the country as talked about by General Nicholson in his departing remarks.
He says the Taliban share an enemy with the US and its allies, which is ISIS in Afghanistan.
"I believe that some of the Taliban want peace," Nicholson said. "But they're being encouraged to keep fighting."
At the handover ceremony, Miller echoed Nicholson with hopes for peace.
He said: "There are groups in Afghanistan who want nothing more than to harm others.
"These groups thrive in ungoverned spaces, they raise money, they recruit, they plan, they inspire attacks. We must maintain pressure on them."
It was said by Taliban commander Mullah Sher Agha on Sunday that the Taliban commanders inside the country are willing to begin peace talks.
He told CNN: "Peace negotiations should be among Afghans and for Afghans.
"We should not wait for Pakistan, Iran, Russia or America to bring peace to Afghanistan."
Only last month the Taliban launched an attack on Ghazni, a city south of the capital, which led to them seizing key buildings and engaging in gun battles with security forces.
It was reported around 16 people were killed and 40 injured - the majority of them Afghan security forces.
This attack showed the Taliban's position and strength, should they enter peace talks with the US.
Even with a shared ISIS enemy and a common goal of ridding the country of ISIS, the Taliban still view the US and the Afghan government with distrust.
Taliban commander Agha said: "Enemy is first ISIS, then government."