Mr Mollah is one of ten Jamaat-e-Islami and Bangladesh Nationalist Party leaders convicted by an International Crimes Tribunal of atrocities during the country's 1971 liberation war in which the government claims three million were killed. Mr Mollah was convicted of massacring a family of six on the evidence of a single witness - a sibling who was 13 at the time and who had given several statements including one in which she said she was not there at the time.
He was initially sentenced to life imprisonment, but the verdict was overturned in favour of the death penalty after the government changed the law and applied it retroactively.
The government came under intense international pressure to halt the execution amid warnings from Western leaders that it will lead to more violence and sabotage talks to persuade Bangladesh's opposition parties to contest next month's general election.
British foreign minister Baroness Sayeeda Warsi met Prime Minister Sheikh Hasina on Thursday morning and stressed the UK's opposition to the death penalty.
Seven people have been killed in clashes since the death sentence was announced earlier this week. Supporters of Mr Mollah's Jamaat-e-Islami destroyed cars and set off explosives in Chittagong and Sylhet in the north-east.
His legal team and human rights groups warned of bloodshed if the sentence was carried out. But Mr Mollah was hanged at 10.01 pm.
Bangladeshi security personnel stand guard at the jail where Mr Mollah was hanged (AFP)
Hundreds of people in the centre of Dhaka cheered following the announcement, underlining how the case has divided Bangladeshi opinion.
'Justice has been served, though we had to wait for 42 years,' said university student Afzal Hossain.
Mr Mollah's Jamaat-e-Islami will hold funeral events on Friday followed by strikes in protest on Sunday.
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