But that alliance unravelled over the past week as the former leader reached out to the Saudi-led coalition that has waged an air campaign against the Houthis since March 2015.
Houthi rebels in Yemen have held dozens of journalists captive for days at a television station in the capital and a media watchdog has demanded their immediate release.
The commander of Iran's Islamic Revolution Guards Corps, Major General Mohammad Ali Jafari, said Yemen's enemies had been behind Saleh's armed uprising and praised what he called the Houthis' swift quashing of the "coup against the holy warriors", the semi-official Fars news agency reported.
In a televised speech, Yemeni President Abd-Rabbu Mansour Hadi called on Yemenis to rise up against the Iran-aligned Houthis.
Sanders reiterated the Trump administration's general support for the Saudi-led coalition, and condemned Iran's Islamic Revolutionary Guard Corps for "aggression and blatant violations of global law" in Yemen.
A military source said the Huthis stopped their four-car convoy about 40 kilometres south of Sanaa and shot dead Saleh and two other senior GPC officials.
A video circulating on social media showed fully-veiled women chanting "The people want the martyr's body".
The end of the alliance between the Houthis and Saleh might have tilted the three-year civil war in favor of Yemen's internationally recognized government and the Saudi-led coalition.
The bloody conflict has left impoverished Yemen as the world's leading humanitarian disasters with millions of people facing starvation.
The killing could either push the conflict towards United Nations peace negotiations or make it an "even more vicious war", Mattis told reporters.
Saleh's slaying likely gives the rebels the upper hand in the dayslong fighting for the country's capital, Sanaa.
From the Saudi capital, Riyadh, where he has been in self-imposed exile for most of the war, Hadi tried on Monday to rally Saleh's allies to keep up the fight against the Houthis. That seems to have pushed Saleh into flirting with the coalition, ultimately leading to the breakdown of the rebel alliance. Witnesses said the bodies of slain civilians and fighters littered the streets as ambulances were unable to reach them.
At least 234 people have been killed and more than 400 wounded in fighting in Sanaa since the beginning of the month, the International Committee of the Red Cross (ICRC) said on Tuesday.