Germany's foreign intelligence agency, the BND, said that it shredded in the 1990s files relating to Nazi war criminal Alois Brunner, confirming a report on Spiegel's online edition.
"I can confirm to you that the BND's internal research and working group 'The history of the BND' recently discovered that files on Alois Brunner were destroyed in the 1990s," a spokesman told AFP in an emailed statement.
"Further details will be published on our homepage in the coming months."
Brunner, born in 1912, is top of the Simon Wiesenthal list of wanted Nazis for deporting tens of thousands of Jews to the death camps, although the centre calls the chances of his still being alive "relatively slim".
After the war, he escaped detection by taking on a false identity and worked for two years for the US occupying forces in Germany, before fleeing to Egypt in 1954 and from there to Syria, where he was protected by successive regimes.
French investigators, trying to call him to account for crimes committed during the occupation of their country, lost track of him in 1992 in Damascus, where he had been living under an assumed identity.
According to Spiegel magazine, the 581 pages destroyed relate mostly to the period 1954-1964, with their disposal raising questions about whether Brunner worked for the BND after the war and if he was being protected by someone senior.
It is not the first time that the BND has fallen under suspicion of protecting former Nazis after World War II. A team of historians is currently combing through its archives.
Spiegel reported in January that Klaus Barbie, the notorious former Gestapo head of Lyon, France, worked for the BND in Bolivia after the war. He was sentenced to life in prison in 1987 and died in jail in 1991.
This followed a report in the Bild daily citing newly released documents showing that German intelligence knew Adolf Eichmann, one of the key architects of the Holocaust, was hiding out in Argentina eight years before Israeli agents kidnapped him in 1960.