The pilotless plane hit the militants' compound in Nargas village of Birmal area, some 30 kilometres west of Wana, the main town of South Waziristan.
"Abdullah Haqqani (the commander) was responsible for sending suicide bombers to Afghanistan," an official said.
A security official said seven rebels including four foreigners, one of Arab-origin, were killed in the attack and the compound was completely destroyed. The killed Arab was identified as Adil while the exact identity of others was not known.
Reports said that some militants were also injured in the attack. South Waziristan, adjacent to North Waziristan, was cleared of militants in 2009 but still they are active in its remote areas.
The US has persisted with drone attacks despite complaints by Pakistan that such attacks were a violation of its sovereignty. South Waziristan is one of the seven lawless tribal districts of Pakistan bordering Afghanistan.
These semi-autonomous areas have for years been a safe heaven for militants of all hues -- including Al Qaeda and the homegrown Tehreek-e-Taliban Pakistan (TTP) as well as foreign fighters such as Uzbeks and Uighurs.
US pressed Pakistan for years to clear these sanctuaries in the North Waziristan tribal area, which militants have used to launch attacks on NATO forces in Afghanistan.
Pakistan Army launched a major offensive (Zarb-e-Azb) in North Waziristan in June and say they have killed more than 1,100 militants so far, with 100 soldiers losing their lives in the operation.