A single shot was heard inside before the cabin was engulfed in flames, the law enforcement official told The Associated Press.
Until Tuesday, authorities weren't sure Dorner was still in Big Bear Lake, where his pickup was found within walking distance from the cabin where he hid.
Even door-to-door searches failed to turn up any trace of him in the quiet, bucolic neighborhood where children were playing in the snow Tuesday night.
With many searchers leaving town amid speculation he was long gone, the command center across the street was taken down Monday.
Ron Erickson, whose house is only about quarter mile away, said officers interrogated him to make sure he wasn't being held hostage. Erickson himself had been keeping a nervous watch on his neighborhood, but he never saw the hulking Dorner.
"I looked at all the cabins that backed the national forest and I just didn't think to look at the one across from the command post," he said. "It didn't cross my mind. It just didn't."
Police said Dorner began his run on Feb. 6 after they connected the slayings of a former police captain's daughter and her fiance with his angry manifesto.
Dorner blamed LAPD Capt. Randal Quan for providing poor representation before the police disciplinary board that fired him for filing a false report.
Dorner, who is black, claimed in his online rant that he was the subject of racism by the department and was targeted for doing the right thing.
Chief Charlie Beck, who initially dismissed Dorner's allegations, said he would reopen the investigation into his firing — not to appease the ex-officer, but to restore confidence in the black community, which had a long fractured relationship with police that has improved in recent years.
Dorner vowed to get even with those who had wronged him as part of his plan to reclaim his good name.
"You're going to see what a whistleblower can do when you take everything from him especially his NAME!!!" the rant said. "You have awoken a sleeping giant."
Within hours of being named as a suspect in the killings, the 6-foot, 270-pounder described as armed and "extremely dangerous," tried unsuccessfully to steal a boat in San Diego to flee to Mexico. After leaving a trail of evidence, he headed north where he opened fire on two patrol cars in Riverside County, shooting three officers and killing one.
With a description of his car broadcast all over the Southwest and Mexico, he managed to get to the mountains 80 miles east of Los Angeles where his burning truck was found.
Only a short distance from the truck, he spent his final days with a front-row seat to the search mobilized right outside.