On the run for more than a decade, Falsone was sentenced in absentia in 2004 to life imprisonment for murder, extortion and mafia association, the Italian news agency ANSA reported.
The 40-year-old Sicilian, who was on a list of 18 mafia figures wanted by Italian authorities, had undergone plastic surgery and communicated with Sicily using the Internet. Five mobiles phones were found in the apartment.
The investigation began in April when Falsone was believed to have arrived in Marseille. Falsone used a fake boat licence from a person already known to anti-organised crime police.
He wished to move to the southern French city permanently and invest in a construction company, according to the source.
Italian police spent a month in Marseille before making the arrest.
An international arrest warrant has already been filed and Falsone was expected to be transferred to Italy.
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