Saeed Mortazavi was taken into custody after Ahmadinejad singled out a rival from the powerful Larijani family during a session of Parliament broadcast on state radio, The New York Times reported.
In that session, Ahmadinejad played a video clip of a conversation in which Fazel Larijani appears to discuss with aide Mortazavi the purchase of a state company for favorable terms.
Fazel Larijani denied any wrongdoing and accused Ahmadinejad and Mortazavi of "spreading lies and disturbing public opinion."
Mortazavi was taken into custody Monday evening but no reason for his arrest was given.
A conservative newspaper in Iran hinted that the nation's supreme leader Ayatollah Ali Khamenei had stepped in to end the fighting between Ahmadinejad and the Larijanis.
Ali Larijani heads the Iranian Parliament while a younger brother Sadegh is head of the judiciary.