Bangladeshi children play with a toy depicting Osama bin Laden riding on the back of a jeep after being arrested by the US military.
Bangladeshi children play with a toy depicting Osama bin Laden riding on the back of a jeep after being arrested by the US military.Reuters

The CIA secretly developed a "demonic" Osama bin Laden action figure to scare Pakistani and Afghan children and undermine public support for the al-Qaida figurehead, it has emerged.

The spy agency began developing the custom-made toy in 2005, during the hunt for Bin Laden, with the assistance of renowned toymaker Donald Levine, who was instrumental in the creation of GI Joe action figures, the Washington Post reported.

The face of the toy was designed with a heat-dissolving material, which would peel away and reveal a red-faced devil-like Bin Laden with terrifying black facial markings.

A Chinese artist created an image of Bin Laden using publicly available photographs and the final prototype was dressed in traditional attire and packaged in a cheap box.

A source familiar with operation told the Washington Post: "It appealed to [Levine] because it had nothing to do with actually hurting someone. It was the softer side of the CIA."

As part of the plot, code-named "Devil Eyes", hundreds of the 12-inch action figures were reportedly sent to Pakistan in 2006.

However, the CIA said the project was discontinued after the prototypes were developed.

CIA spokesman Ryan Trapani said: "To our knowledge, there were only three individual action figures ever created, and these were merely to show what a final product might look like.

"After being presented with these examples, the CIA declined to pursue this idea and did not produce or distribute any of these action figures. Furthermore, the CIA has no knowledge of these action figures being produced or distributed by others."

Levine died in May at the age of 86 after a lengthy battle with cancer. In response to questions about his involvement in the Bin Laden toys, his family said in a statement: "Don Levine was a dedicated patriot and proud Korean War veteran. When called on, he was honoured to assist our country."

The CIA has long been known for its covert operations designed to influenced foreign policy and public opinion abroad.

The organisation has orchestrated numerous subversion efforts aimed at overthrowing the communist government in Cuba, including pirate TV and radio broadcasts, anti-government propaganda and attempts to assassinate former Cuban leader Fidel Castro.

Earlier this year, it emerged that the US overseas development agency USAID secretly created a Twitter-style social network called ZunZuneo in a bid to circumvent censorship and undermine Cuba's communist government.