Qari Abdul Hayee, a former leader of the Sunni sectarian group Lashkar-e-Jhangvi, or LeJ, was aware of the plan to kidnap Pearl, The Wall Street Journal's South Asia bureau chief, who was decapitated, according to a military official who asked not to be named because he wasn't authorized to comment on the case.
Imran Shaukat, police spokesman in Sindh province, confirmed Hayee's arrest in the port city of Karachi.
Rehman Malik, former Pakistan interior minister, said last month that the group was responsible for 80 percent of terrorist activity in the country after a surge in attacks on the Shia, Geo television reported.
Khalid Sheikh Mohammed, mastermind of the Sept. 11 terror attacks who is imprisoned at Guantánamo Bay, Cuba, carried out the killing of Pearl. Mohammed told a March 2007 U.S. military hearing there that he had personally slit Pearl's throat and beheaded him.
A video of Pearl's decapitation was sent to the U.S. consulate in Karachi.
U.K.-born Islamic militant Ahmed Omar Sheikh was sentenced to death in July 2002 for murdering the journalist and being the lead planner in his capture. He's still in prison.
Three of his collaborators received life sentences for assisting in the kidnapping.