Saudi Arabia had warned Germany about the man suspected of carrying out the incident at the Magdeburg Christmas market, according to Saudi Arabian security sources.
Saudi Arabia requested the extradition of the suspect, named under German law as Taleb A., but Germany had not responded, the sources said.
They said the man was a Shiite Muslim who comes from the city of Al-Hofuf in eastern Saudi Arabia. Shiites are a minority in the country, making up only around 10% in the majority Sunni nation.
German authorities were alerted about the man about a year ago, dpa has learned, however the nature of the warning is currently unknown.
The detained suspect is a 50-year-old doctor, authorities said.
He is known as an anti-Islam figure and arrived in Germany in 2006. Dpa has learned that he applied for asylum in February 2016 and was granted political refugee status in July of that year.