The former rap mogul was arrested after leaving a restaurant at Universal City Walk early Saturday, KTLA-TV, Los Angeles, reported.
Los Angeles County Sheriff's Sgt. Shawn Ruda said Knight was picked up for an outstanding traffic warrant related to a Sept. 23 incident for allegedly driving through a stop sign and driving a vehicle with a suspended license.
Knight was released about an hour later after agreeing to appear in court and answer to the charges within two months.
Ruda told the Los Angeles Times that Knight -- who has a long arrest record in the state of California -- was not doing anything wrong when he was stopped by authorities Saturday.
"A person who's been arrested multiple times, you see if he has any outstanding warrants," Ruda said. "And he did."