23 June 2014
Last updated at 10:34 ET
Joe Petrosino, a New York police officer, was shot dead during a mission to the island to collect evidence.
The revelation coincided with the arrest of 95 suspected members of two clans involved in extortion rackets in the island's capital Palermo.
One of those arrested had been recorded boasting that his father's uncle had carried out the killing, police say.
Domenico Palazzotto was overheard telling a colleague that "the uncle of my father was called Paolo Palazzotto; he killed the top policeman killed in Palermo" on the orders of Cascio Ferro. Ferro was a boss in Sicily's Cosa Nostra whose operations extended to the US, Ansa news agency reports.
The notorious murder of Lt Petrosino on 12 March 1909 shocked New York at the time, BBC Rome correspondent Alan Johnston reports.
Described by the FBI as one of New York's first detectives to fight organised crime in the early 1900s, he was an Italian immigrant who had targeted Black Hand extortion rackets involving Sicilian and Italian gangsters in several American cities.
Lt Petrosino was said to have gone undercover as a blind beggar, a sanitation worker and a health inspector. But on a secret mission to Sicily he was fatally shot four times in the street, while waiting for a supposed informant. The attack was witnessed by a group of people waiting for a tram.
The revelations emerged as police gathered information while preparing an anti-Mafia operation in the Palermo districts of Resuttana and San Lorenzo.
Nobody was ever convicted of Joe Petrosino's murder, our correspondent says.
Although Cascio Ferro and Paolo Palazzotto himself were picked up after the shooting, they were eventually released for lack of evidence.
Italy police 'solve' 1909 Petrosino Mafia murder
Police on the Italian island of Sicily believe they have solved a Mafia murder mystery dating back to 1909.
The revelation coincided with the arrest of 95 suspected members of two clans involved in extortion rackets in the island's capital Palermo.
One of those arrested had been recorded boasting that his father's uncle had carried out the killing, police say.
Domenico Palazzotto was overheard telling a colleague that "the uncle of my father was called Paolo Palazzotto; he killed the top policeman killed in Palermo" on the orders of Cascio Ferro. Ferro was a boss in Sicily's Cosa Nostra whose operations extended to the US, Ansa news agency reports.
The notorious murder of Lt Petrosino on 12 March 1909 shocked New York at the time, BBC Rome correspondent Alan Johnston reports.
Described by the FBI as one of New York's first detectives to fight organised crime in the early 1900s, he was an Italian immigrant who had targeted Black Hand extortion rackets involving Sicilian and Italian gangsters in several American cities.
Lt Petrosino was said to have gone undercover as a blind beggar, a sanitation worker and a health inspector. But on a secret mission to Sicily he was fatally shot four times in the street, while waiting for a supposed informant. The attack was witnessed by a group of people waiting for a tram.
The revelations emerged as police gathered information while preparing an anti-Mafia operation in the Palermo districts of Resuttana and San Lorenzo.
Nobody was ever convicted of Joe Petrosino's murder, our correspondent says.
Although Cascio Ferro and Paolo Palazzotto himself were picked up after the shooting, they were eventually released for lack of evidence.
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