Pascual Sanchez Carbajal, 48, was held in the death of Hilarion Alvarado Crieta, 42, Sunday night in Elgin, about 25 miles east of Austin.
Investigators said Carbajal, shortly after arriving at the party, went to his vehicle, retrieved a gun, returned to the event and began shooting.
Crieta was shot in the back and pronounced dead at the scene, the Austin American Statesman reported Monday.
Carbajal then shot his wife in the leg and fired at least two more rounds into the crowd of mostly juveniles, hitting no one else, before attempting to turn the gun on himself, police said.
His wife's wound was not life-threatening, police said.
Carbajal was restrained by other partygoers until police arrived.
Police said he was taken into custody without incident. Charges were not specified.