Eight SAS soldiers and a UK diplomat were detained by rebels in Libya, with whom the UK servicemen were actually trying to establish contact.
Britain apparently sent a secret mission to support rebels in Libya, which has backfired, reports the Sunday Times.
Many in Libya are concerned that a possible foreign military support might be interpreted by their foe, Libyan leader Muammar Gaddafi, as an anti-Libyan foreign intervention and thus an argument in his favor.
The eight SAS servicemen were escorting a junior UK diplomat through rebel held Libyan territory, when they were captured by rebels and sent to a local military base.
The Foreign Office has neither confirmed nor denied the report.
The group of arrested persons were reportedly also questioned in Benghazi by a leader of the rebellion.
The Sunday Times also reports that opposition officials are trying to hush up the incident so as not to draw the ire of ordinary Libyans.