Police rushed to the upmarket town of Pozuelo de Alarcón where "several people" shot a male "in the back and head" as he "prepared to climb into a vehicle", the source said, confirming the victim was Andriy Portnov.
The shooters "later fled from the scene towards a wooded area", the source added, saying the incident had occurred outside an American private school.
Portnov was a lawmaker in the 2000s and became deputy head of the presidential administration under Yanukovych, an ally of Russian President Vladimir Putin who fled to Russia in 2014 after cracking down on pro-EU protests in Ukraine.
Portnov quit Ukraine after Yanukovych's fall, living in Russia and Austria before returning to his home country after the election of current President Volodymyr Zelensky.
The United States imposed sanctions on him in 2021 for alleged corruption, saying he had used his influence in the judiciary and law enforcement to buy access in Ukrainian courts and undermine reform efforts.
According to media reports, he used his connections within the spheres of power to escape Ukraine again in 2022, despite a ban on men liable for military service leaving the country during the Russian invasion.
Ukrainian authorities had not commented on the incident, but a military intelligence official told AFP on condition of anonymity that Portnov had been shot dead.
Ukraine has claimed or been linked with several assassinations in Russia and Moscow-occupied parts of Ukraine since the start of the invasion in 2022, targeting political or military officials or ideological supporters of the war.
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