Ghulam Mohammad Lone, 45, was shot by the militants inside his residence at Kulpora village, 35 kms from here, they said.
Lone, who was associated with ruling NC, died on the spot, they said.
No militant outfit has so far claimed responsibility for Lone's killing.
Militants have targeted several panchayat members, killing six of them, in the Valley since the Panchayat elections were held in April 2011.
This is the sixth instance in the last eight months in which a sarpanch has been killed in the state.
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On February 24, sarpanch Javed Ahmed Wani was shot at and critically injured by the suspected militants inside his house in the Kreeri area of Baramullaat.
Wani, who was also affiliated with to the NC, was rushed to a nearby hospital where he succumbed to injuries.
On January 11, sarpanch Habibullah Mir was shot dead in Sopore township of Baramulla district in north Kashmir, prompting Chief Minister Omar Abdullah to order more security to panchayat heads.