Syed Mohammad Hasan Ali, 68, was found guilty on five charges out of six and Justice M Enaytur Rahim, chairman of the three-member panel of International Crimes Tribunal-1, handed down the death sentence to him.
The verdict said that the "death be executed by hanging the accused by the neck till he is dead or by shooting him till he is dead".
"The government will decide on his manner of execution," the judge said in a rare directive while handing down death penalties.
Ali, a commander of the notorious Razakar Bahini which was formed as an auxiliary force to the Pakistani troops, was defended by a state appointed lawyer during the trial.
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Under the law, Ali can challenge the verdict in the Appellate Division of the Supreme Court after surrendering before the tribunal.
The tribunal said five out of the six charges like massacre, murders, torture particularly of Hindus and arson, against Ali were "proved beyond doubt" and he was awarded the capital punishment for two of the charges.
According to witnesses, Ali's notoriety in Tarhail area of the district in 1971 earned him the title of 'Razakar Daroga' (Razakar police officer).
He is believed to have fled the country as the trial process was initiated but 26 witnesses testified against Ali during the trial.
This was the 19th verdict delivered by the country's two war crimes tribunals since Bangladesh initiated the trials of suspected war criminals in 2010. In the previous 18 cases, the tribunals tried 18 people and handed down death penalty to 13.