Samantha Lewthwaite dubbed the White Widow is believed to be hiding in Yemen, British security services believe, The Mirror reported, adding that she might be under the protection of fighters from the militant group al-Shabaab.
READ MORE: UK Grandad Banned From US After Accidentally Declaring Himself a 'Terrorist'
Fifty-two people died in the attacks, with Lindsay killing 27 of them on London's tube.
Lewthwaite, who is believed to have had plastic surgery to alter her appearance, is reported to have recently visited Dubai, with sources telling The Mirror that she might be up to a new series of terrorist attacks, including in London.
The intelligence was reportedly gathered after an MI6 officer recruited a source close to the White Widow in the Kenyan capital of Nairobi.
"She remains our No1 target and we believe the net is finally closing in. We will get her", the source told the publication.
Lewthwaite is understood to have relocated to Yemen "after being linked to atrocities in Kenya and Somalia", The Mirror wrote.
"Yemen is a hotbed for al-Shabaab recruitment and its chaotic political situation gives an advantage to on-the-run terrorists like her", the source added.
She is alleged to have recruited female suicide bombers with bribes of $380, which is a huge amount for local people.
In 2013, Interpol issued an arrest warrant for Lewthwaite over alleged links to the planning of the Westgate shopping mall attack in Nairobi, which left 67 dead. Al-Shabaab claimed responsibility for the atrocity.