The suspect's attorney says the result was a mistranslation that caused his client to break down, The Copenhagen Post reported. The man, an ethnic Kurd, was suspected of donating money to the Kurdistan Workers Party or PKK through Roj TV, a Kurdish station headquartered in Copenhagen.
The European Union classifies the party, which is active mainly in Turkey, as a terrorist organization.
Thorkild Hoyer, the lawyer representing the 50-year-old man, said the mistranslation violates a law barring police from giving misinformation during questioning.
"But it is even more serious in a case involving allegations of terrorism, and in which the accused are being held on remand," he told the newspaper Politiken.
Copenhagen Police Inspector Svend Foldager told Politiken the incident was the only one he knows of where police have turned to Google Translate. The mistranslation was later caught by an interpreter.
"There is not much to say other than it was a mistake," he said. "I know only of this one instance and I've never heard of it happening before."
The mistranslation was of a text-message in Turkish sent out en masse to announce a meeting. It was translated as "I call a meeting."
Roj TV has appealed a fine of 5.2 million kronor ($911,000).