MANILA - Muslim militants beheaded a school principal on a remote southern island in the Philippines after holding him for ransom for three weeks, a marine general said on Monday.

Major-General Ben Dolorfino, commander of military forces in the western part of Mindanao region, said the victim's decapitated head was found at a petrol station in the capital town on Jolo island.

"We were told the school principal was beheaded on Sunday when the negotiations to free him bogged down," Dolorfino said.

The man was head of a school on Jolo and a relatively senior public figure in the impoverished area. He had been snatched by Abu Sayyaf rebels who had demanded 2 million pesos ransom, equivalent to about $42,000 (25,000 pound).

President Gloria Macapagal Arroyo has ordered troops to step up military operations against the Abu Sayyaf, an al Qaeda-linked militant group known for kidnapping and beheading hostages.

The group is mostly active on Jolo and the nearby island of Basilan.

(Reporting by Manny Mogato; Editing by Raju Gopalakrishnan and Ron Popeski)