This is the first arrest in Germany related to Volkswagen's emissions-test cheating scandal.

Munich prosecutors declined to comment on whether the arrested person is a current or former Audi employee.

On Thursday, the US Justice Department said it had charged former Audi manager Giovanni Pamio with directing staff to design emissions-cheating software.

Audi and parent company Volkswagen both declined to comment.

Analysis: BBC business correspondent Theo Leggett

The Munich prosecutor's office has been investigating Volkswagen for some time, and searches were carried out at the company's premises in March.

An Audi employee has now been arrested on suspicion of fraud and false advertising in connection with the scandal, which involved vehicles being fitted with software that enabled them to pass emissions tests despite producing large quantities of pollution.

The employee has not been named, but according to reports in the German media, he is the same man who was separately charged on Thursday by the US authorities, 60-year-old engine developer Giovanni Pamio.

He has been accused of directing Audi employees to design software to undermine the testing process.

The Munich prosecutor's office said the Audi employee was brought before a judge on Tuesday and was now being held in custody.

A spokeswoman declined to discuss the possibility of the detained person being extradited to another country or comment on whether Munich prosecutors were in touch with US authorities.

The German arrest was part of a wider probe into fraud and false advertising and is a consequence of "findings following searches," the spokeswoman said.

No members of the Audi management board are being personally investigated as part of that probe, she added.

US charges

In a statement released by US authorities on Thursday, US prosecutors alleged that Mr Pamio ignored or suppressed warnings by certain Audi engineers that the pollution control systems being used on the brand's diesel engines contravened US clean air rules.

US prosecutors said Mr Pamio had told subordinates to send false information to American regulators stating that Audi's "clean diesels" did not use technology designed to cheat federal pollution tests.

Mr Pamio could not be reached for comment on Friday.