Mohamed El-Zawahri, a leading figure in the Egyptian Jihadist Salafist group and the brother of Al-Qaeda leader Ayman El-Zawahri, was arrested in Cairo on Saturday.
Police forces arrested El-Zawahri on Nile Street, Dokki, Giza, Ahram's Arabic website reported.
It is still unconfirmed on what charges El-Zawahri is being held.
A source at Egypt's Prison Authority told Ahram that El-Zawahri is being kept under tight security in a prison, but did not specify the location. He added that a team from the prosecution will start investigation the file soon.
Black flags bearing the Islamic profession of faith – often used by Islamist and jihadist groups, including Al Qaeda - have appeared on several occasions at Islamist protests in Egypt over the past year.
Most recently, they were seen in Ramses, downtown Cairo, as violence erupted following a Muslim Brotherhood march protesting recent police violence against the pro-Morsi protests.
State news agency MENA reported that “over five cars, driven by masked men, have reached Ramses Square to distribute firearms” to those in the crowds in Ramses.
However, the Brotherhood’s Freedom and Justice Party’s official Facebook page claimed that the interior ministry “brought masked men carrying Al-Qaeda’s flag to delude the people that they are protesters.”
Earlier in August, Ayman Al-Zawahiri accused the US of "plotting" with Egypt's military, secularists and Christians to overthrow Islamist president Mohamed Morsi, in an audio recording posted on militant Islamist forums.
In his first public comment on the 3 July outser of Morsi, the Al-Qaeda leader, himself an Egyptian, said: "Crusaders and secularists and the Americanised army have converged ... with Gulf money and American plotting to topple Mohamed Morsi's government."