Yorgen Fenech, a prominent businessman in Malta, was charged with conspiracy to murder on Saturday over the killing of anti-corruption journalist Daphne Caruana Galizia.
Fenech has pleaded not guilty to the charges against him which includes membership of a criminal gang. He could face up to life in prison, the Times of Malta reported.
The arrest comes as the long-stalled investigation into the October 2017 car bomb murder of Caruana Galizia intensifies.
The businessman's alleged ties to top officials have fueled a political crisis in the country, as ministers quit the government.
Tourism minister Konrad Mizzi resigned and economy minister Chris Cardona suspended himself over the murder investigations.
The prime minister's chief of staff Keith Schembri was arrested earlier in the week but later released.
Thousands of protesters marched in the street on Friday demanding that Prime Minister Joseph Muscat resign. Muscat has said that he plans to do so.
The prolonged investigation into the murder of Caruana Galizia has raised questions about the rule of law in Malta.
On Sunday, Malta's justice minister said that they had "arraigned the alleged mastermind" and defended rule of law in the country.
He said that investigations into the murder "are ongoing".
Fenech was arrested in November while onboard a yacht but was granted bail as investigations continued.
He is the former chief executive of Tumas Group, a property investment company in Malta.