Mayon, who hails from Steelton, Pa., went on the run after he was placed on the FBI's Most Wanted list. He was suspected of burning a federal judge's car, and other violent offences.
U.S. marshals had sought him on two separate arrest warrants. Charges included illegal possession of a firearm, reckless endangerment and flight to avoid apprehension.
He was a known neo-Nazi with links to the white supremacist group Aryan Brotherhood.
The irony of a fugitive with a proven track record of hate crimes finding refuge in the Jewish state was not lost on the Israeli police or local press.
"He was here because he thought this was the last place they would look for him," said Sabine Haddad at Israel's Ministry of Interior.
Mayon fled to Tel Aviv in November 2007. On arrival, he was granted a one-month visa and stayed on illegally after it expired.
Israeli police spokesmen said he had been earning money washing dishes in restaurants and had received extra money from his parents in the United States. His FBI mugshot shows him with a skinhead hair style, but when he was arrested police said he had long, unkempt hair and looked like a hippy.
He was picked up in a predawn raid by a newly formed immigration police unit that had received a tip. Police subsequently claimed the tip came from his Jewish girlfriend who had become pregnant. Police said Mayon had confessed his criminal past to her and she turned him in.
Extradition proceedings to return Mayon to the United States are already under way, and U.S. marshals are on the way to Israel to escort him back to this country.
"Locating and identifying Mayon in a foreign country sends a very strong message that you can run but you cannot hide," said Michael Regan, a U.S. marshal in Pennsylvania.