See a gallery of Banksy's work

His works command tens of thousands of pounds at auction and he counts Hollywood actors among his fans, yet his agent claims never to have met him.

Now it appears that Banksy, the elusive graffiti artist, has let his cover slip by being caught on camera at work for the first time.

He was pictured extending double yellow lines from a road on to the wall of an East London house to form a big yellow flower. To the left of the horticultural daubing sits a stencilled street-worker, sitting on a tin of paint and holding a roller.The picture was taken by a passer-by with a camera phone.

A handful of photographs claiming to show Banksy have surfaced before, but this is believed to be the first time an image has been produced showing the artist at work.

The mural, in the East London borough of Tower Hamlets, is thought to be a riposte to the local council, which has vowed to cleanse the borough of his graffiti.

A council spokesman said last week: “Whilst some graffiti is considered to be art, we know that many of our residents think graffiti in areas where they live, such as local housing estates, is an eyesore.”

The neighbouring council of Hackney has also said that it will hose away his work. “We can’t make a decision as to whether something is art or graffiti,” a spokesman said. “The Government judges us on the number of clean walls we have.”

Banksy, whose real name is thought to be Robert or Robin Banks, is known for his artistic pranks, which have included releasing an inflatable Guantanamo prisoner doll in Disneyland.

The British Museum took eight days to realise that Banksyus Maximus, a rock depicting a Stone Age hunter with a shopping trolley, was not a genuine artefact.

This summer he made a Stonehenge-style circle at the Glastonbury Festival out of portable toilets, and he once painted a hole with blue sky poking through the Palestinian side of the West Bank wall.

The artist has become a favourite with Hollywood actors. Brad Pitt and Angelina Jolie reportedly spent more than £1 million on his works at a sale at Lazarides gallery in Soho this month. In April a mystery US buyer spent £288,000 on Space Girl and Bird at another auction in London after a fierce bidding war.

Last week ten works fetched £500,000 at Bonhams, the West London auctioneers – £200,000 above the estimated price. The most expensive piece, Avon and Somerset Constabulary, showing two policemen looking through binoculars, fetched £96,000. It was estimated at £60,000 to £80,000.

At the same auction Lenin on Roller-skates (Who Put the Revolution on Ice?) fetched £48,000, from an estimate of £20,000 to £30,000. Attack of the Badly Drawn Boy, estimated at £20,000 to £30,000, went for £78,000.

Gareth Williams, senior picture specialist at the auctioneers, said: “The most incredible aspect of the Banksy phenomenon is neither his meteoric rise nor the substantial sums of money that his art now commands but that, as a self-confessed guerrilla artist, he has been so wholeheartedly embraced by the very Establishment he satirises.”

Banksy has let it be known what he thinks of the high prices his works fetch, writing on his website: “I can’t believe you morons buy this s***.”

A spokeswoman for Banksy said that the artwork was genuine, but refused to confirm whether the man shown in the photograph was the artist. “We never confirm or deny whether any image shows Banksy,” she said.

Picture of anonymity

— Banksy’s identity is a closely guarded secret. Neither his name nor his age is known for sure. His agent told The Times that she had never met him

— His real name is thought to be either Robert Banks or Robin Banks. He is thought to have been born in Bristol in 1974

— He is said to have started out as part of a graffiti team and his parents are said to believe that he earns a living as a painter and decorator. One profile said that he was the son of a photocopier engineer and originally trained as a butcher

— His work has included producing parodies of real artworks as well as stunts in public places. He is best known for his stencil works, favoured for the speed at which they can be carried out

— His parodies include a version of Monet’s Water Lilies, modified to show litter and a shopping trolley floating in the water, as well as a version of Edward Hopper’s Nighthawks showing a hooligan in Union Jack underpants smashing the window of the café

— His stunts include smuggling a dead rat in a glass-fronted box into the Natural History Museum, where it formed part of an exhibition for several hours

Editor's choice

• The 100 Best Films of the Decade
• 70 facts you didn't know about Marvel
• The 50 Biggest Movies Of 2010