The gruesome, almost five-minute-long video titled "A Message to America" surfaced yesterday, confronting Twitter and other online platforms with a quandry over whether to allow their sites, normally committed to free expression, to be used to propagate graphic material like that in the video.
The video shows the execution of journalist James Foley by a masked militant and a warning that the group intends to kill a second captive journalist unless the United States halts air strikes in Iraq.
Images of the beheading in an open desert area began disappearing from Twitter at around the same time as Costolo's message was posted.
YouTube also removed the video from its site in accordance with its policy against "violent or gory content that's primarily intended to be shocking, sensational or disrespectful."
Yesterday, Twitter had said it would take down photos of dead individuals if requested by family, going a step beyond its previous rules.
That followed the apparent suicide of Hollywood star Robin Williams, whose daughter, Zelda Williams, quit social media last week, upset by Internet "trolls" defacing images of her Oscar-winning dad.
"Immediate family members and other authorised individuals may request the removal of images or video of deceased individuals, from when critical injury occurs to the moments before or after death," it said.
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