Sinai militant Adel Mohamed Ibrahim, also known as Adel Habara, confessed on Sunday to the murder of 25 off-duty policemen on the Arish-Rafah road, a security source told state news agency MENA.
He was arrested on Saturday along with two other suspects.
Habara re-enacted the crime he reportedly committed, along with others, in front of the authorities.
The source stated that Habara is currently being investigated in order to determine the identity of his accomplices.
Habara has already been sentenced to death in absentia for killing soldiers in the Nile Delta last year.
Authorities have been engaged in a long-running battle against militants in the northern-half of the strategic region, which borders the Gaza Strip and Israel.
Earlier on Saturday, security officials confirmed 31 militants have been arrested since Thursday, including three who are suspected of involvement in last week's attack and two who were caught seeking treatment for wounds sustained during clashes with police.
The 25 off-duty policemen were reportedly stopped on their way to their barracks, lined up and shot on 19 August, in one of the worst militant attacks on security forces in the peninsula in recent months.