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According to police, Devaraje Gowda was arrested at Gulihal toll gate by the Hiriyur Police in Chitradurga district for leaking the video in a pen drive.
He was arrested on a tip-off received by the Hassan Police, which wanted his presence for the case.
Several explicit videos involving Prajwal started making the rounds ahead of the first phase of Lok Sabha elections in Karnataka, which will take place on April 26.
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Three FIRs, including charges of rape, molestation, intimidation, blackmailing, and threatening, have been registered against Prajwal.
Devaraje Gowda is accused of leaking these videos, which he has categorically rejected.
He had contested the 2023 assembly election against JD(S) MLA from Holenarasipura H D Revanna.
Revanna, father of Prajwal, is at present in jail on charges of kidnapping a woman, a mother of three.