Police say the four people in custody are "ultra" fans, associated with another Madrid football club.
Four people were arrested in Spain on Tuesday as part of the investigation into the hanging of a mannequin bearing the likeness of Real Madrid striker Vinícius Junior at the end of January, police said.
The arrests come two days after new racist insults were made against the Brazilian star during a Spanish football championship match, which sparked a wave of indignation in the country and abroad. Three other men were arrested in Valencia on Tuesday in connection with the incident.
The four people arrested in the Spanish capital are charged with a "hate crime", a criminal category that includes racist offences in Spain, police said in a statement.
Three of them are "active members of an ultra group of supporters of a Madrid club," the police added without identifying the club.
The mannequin, wearing a Vinícius Junior shirt, was found hanged on 26 January, the day of a 3-1 Real Madrid derby win over Atletico Madrid in the quarter-finals of the Copa del Rey, under a banner reading "Madrid hates Real".
After the incident, Real Madrid denounced a "malicious and disgusting racist and xenophobic act" against its 22-year-old player, a regular target of racist insults, and said in a statement that it hoped the perpetrators would be punished. An investigation was opened in the wake of the incident.
The investigations, based in particular on testimonies, made it possible to establish that these four supporters, "identified during matches classified as high-risk" within the framework of "measures to prevent violence in sport", were the "presumed perpetrators" of the hanging of the mannequin, police said.
The arrests come just a day after Real Madrid filed a complaint with the Spanish prosecutor's office alleging a "hate crime" against Vinicius.
On Sunday, the Brazilian striker was subjected to racial abuse from Valencia fans both before and during the game, which left the player in tears.
Real Madrid coach Carlo Ancelotti considered replacing the star forward after Vinícius said fans at Mestalla chanted “monkey” toward him. He said Vinícius initially didn't want to continue playing.
“When a stadium yells ‘monkey’ to a player, and the coach considers taking him out of the field because of that, it means that there is something bad in this league," said Ancelotti.