The CIA also directs millions of dollars to other foreign spy services. But the magnitude of the payments to the ISI reflect Pakistan's central role. The CIA depends on Pakistan's cooperation to carry out missile strikes by Predator drones that have killed dozens of suspected extremists in Pakistani border areas.
The ISI is a highly compartmentalized intelligence service, with divisions that sometimes seem at odds with one another. Units that work closely with the CIA are walled off from a highly secretive branch that has directed insurgencies in Afghanistan and Kashmir.
"There really are two ISIs," the former CIA operative said. "On the counter-terrorism side, those guys were in lock-step with us," the former operative said. "And then there was the 'long-beard' side. Those are the ones who created the Taliban and are supporting groups like Haqqani."
The network led by Jalaluddin Haqqani has been accused of carrying out a series of suicide attacks in Afghanistan, including the 2008 bombing of the Indian Embassy in Kabul.
Pakistani leaders, offended by questions about their commitment, point to their capture of high-value targets, including accused Sept. 11 organizer Khalid Shaikh Mohammed. They also underscore the price their spy service has paid.
Militants hit ISI's regional headquarters in Peshawar on Friday in an attack that killed at least 10 people. In May, a similar strike near an ISI facility in Lahore killed more than two dozen people. Gen. Ashfaq Kayani, who served as ISI director before becoming army chief of staff, has told U.S. officials that dozens of ISI operatives have been killed in operations conducted at the behest of the United States.
A onetime aide to former Secretary of State Condoleezza Rice described a pointed exchange in which Kayani said his spies were no safer than CIA agents when trying to infiltrate notoriously hostile Pashtun tribes.
"Madame Secretary, they call us all white men," Kayani said, according to the former aide.
CIA payments to the ISI can be traced to the 1980s, when the Pakistani agency managed the flow of money and weapons to the Afghan mujahedin. That support slowed during the 1990s, after the Soviets were expelled from Afghanistan, but increased after the Sept. 11 attacks.
In addition to bankrolling the ISI's budget, the CIA created a clandestine reward program that paid bounties for suspected terrorists. The first check, for $10 million, was for the capture of Abu Zubaydah, a top Al Qaeda figure, the former official said. The ISI got $25 million more for Khalid Shaikh Mohammed's capture.
But the CIA's most-wanted list went beyond those widely known names.
"There were a lot of people I had never heard of, and they were good for $1 million or more," said a former CIA official who served in Islamabad.
Former CIA Director George J. Tenet acknowledged the bounties in a little-noticed section in his 2007 memoir. Sometimes, payments were made with a dramatic flair.
"We would show up in someone's office, offer our thanks, and we would leave behind a briefcase full of $100 bills, sometimes totaling more than a million in a single transaction," Tenet wrote.
The CIA's bounty program was conceived as a counterpart to the Rewards for Justice program administered by the State Department. The rules of that program render officials of foreign governments ineligible, making it meaningless to intelligence services such as the ISI.
The reward payments have slowed as the number of suspected Al Qaeda operatives captured or killed by the ISI has declined. Many militants fled from major cities where the ISI has a large presence to tribal regions patrolled by Predator drones.
The CIA has set limits on how the money and rewards are used. In particular, officials said, the agency has refused to pay rewards to the ISI for information used in Predator strikes.
U.S. officials were reluctant to give the ISI a financial incentive to nominate targets, and feared doing so would lead the Pakistanis to refrain from sharing other kinds of intelligence.
"It's a fine line," said a former senior U.S. counter-terrorism official involved in policy decisions on Pakistan. "You don't want to create perverse incentives that corrode the relationship."
Times staff writer Alex Rodriguez in Islamabad contributed to this report.