Ali Haddad, one of Algeria's top businessmen and a backer of ailing President Abdelaziz Bouteflika, was arrested as he tried to cross into Tunisia, an Algerian security source said on Sunday.
Haddad, who Forbes magazine describes as one of Algeria's wealthiest entrepreneurs, was detained overnight at a border post with neighbouring Tunisia, said the source speaking on condition of anonymity.
The North African state has been rocked by weeks of mammoth protests sparked by Bouteflika's decision in February to seek a fifth term in office.
Protesters are also demanding a change of government and the departure of those close to Bouteflika, who uses a wheelchair and has rarely been seen in public since suffering a stroke in 2013.
Reasons for his arrest were not immediately clear and there was no official explanation for his detention.
A judicial source said there were no arrest warrants for the business tycoon and that he did not face any travel ban.
The concession has done little to halt public ire and hundreds of thousands of people took to the streets of the capital Algiers on Friday demanding the president and his entourage to leave power.
Faced with the persistent anger, a succession of veteran Bouteflika loyalists have sought to distance themselves from the president in recent days.
On Tuesday, armed forces chief of staff Ahmed Gaid Salah called for him to step down or be declared medically unfit.