Giuseppe Ferraro, 47, and Giuseppe Crea, 37, both high-ranking members of the powerful and immensely wealthy 'Ndrangheta organised crime group, are both on Italy's most dangerous fugitives list, police told AFP.
Ferraro, found guilty in absentia of a string of brutal murders and described as "extremely dangerous" by police, had been on the run for 18 years.
Crea, wanted for mafia association and extortion, disappeared 10 years ago.
Ferraro's clan is also believed to have been involved in the gunning down of rival boss Domenico Bonarrigo in a turf war.
"They were living in a concrete bunker hidden by dense bushes and trees," said prosecutor Federico Cafiero De Raho, describing the hideout in the mountains near the town of Maropati in the Reggio Calabria region of southern Italy.
Maropati was founded in the 10th century after being used as a hideout by people fleeing Saracen pirates on the coast.
"They were living like animals, a cold life cut off from society" but with enough contact with the underworld to rule on gang matters when necessary, Cafiero De Raho told a press conference.
"Those of us who were there today (at the arrest) knew how difficult it was, but probably only fully realised afterwards how dangerous it was," police commissioner Raffaele Grassi said.
The men were "still actively managing the clan's affairs and had a military control over the territory," said Rosy Bindi, head of the parliamentary anti-mafia commission.
Crea is suspected of having gunned down Francesco Inzitari, the teenage son of a rival, in 2009.
"Now that the territory has been freed of these two dangerous fugitives, I invite people to come forward and collaborate to throw light on their crimes, like the murder of Francesco Inzitari," the prosecutor said.
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