Inocente Montano Morales, 72, is currently serving a 21-month prison term in the United States for immigration fraud and perjury, but he is due to be released on April 16th, the Justice Department said in a statement.
Montano Morales served as El Salvador's deputy defense minister at the time of the assassinations of the Jesuit priests who were seeking an end to the nation's bloody civil war.
Six priests, their housekeeper and the housekeeper's 16-year-old daughter were gunned down in their residence on the campus of the Universidad Centroamericana in San Salvador.
Five of the priests were Spanish nationals, including university rector Ignacio Ellacuria.
Montano Morales has been indicted in Spain, along with 19 other former members of the Salvadoran military, of the murders of the Spanish nationals among the dead.
"The complaint alleges that he shared oversight responsibility over a government radio station that, days before the massacre, issued threats urging the murder of the Jesuit priests," the Justice Department said.
"The day before the murders, Montano Morales also allegedly participated in a series of meetings during which one of his fellow officers gave the order to kill the leader of the Jesuits and leave no witnesses," it said.
El Salvador's civil war raged from 1980 to 1991, and claimed the lives of an estimated 75,000 people.