Police said the warrant for Emmanuel Karenzi Karake, head of Rwanda's intelligence and security service, was made on behalf of authorities in Spain.
Karake, a close ally of Rwandan President Paul Kagame, was one of 40 members of the Rwandan military indicted in 2008 on charges of terrorism and genocide by Spanish national Court Judge Fernando Andreu.
Spanish magistrates have used the principle of universal jurisdiction several times to go after current or former government leaders or terrorism suspects, even indicting Osama bin Laden over the Sept. 11, 2001, attacks. But extraditions and convictions have been rare.
On Twitter, Rwandan Foreign Minister Louise Mushikiwabo called the arrest "an outrage," adding "Western solidarity in demeaning Africans is unacceptable."
Rwanda and Britain "are talking to resolve the matter," Rwandan Justice Minister Johnston Busingye said, insisting that Spain's indictment of Karake was illegitimate and politically motivated.
Police said Karake was arrested Saturday, had a brief hearing at Westminster Magistrates' Court that day and will be back in court on Thursday.
A spokesman for Spain's National Court said it was now up to British authorities to decide whether or not to extradite Karake. He spoke on condition of anonymity in keeping with court policy.
Andreu began considering the Rwanda case in 2005 after a complaint was filed by an African human rights group. Others indicted include James Kabarebe, now the defense minister in Rwanda.
In the 182-page indictment, Andreu said he also had evidence implicating Kagame, who led the rebel forces that stopped the genocide in 1994, but could not charge him because as a sitting president Kagame has immunity.
In 1998, a Spanish judge indicted former Chilean President Augusto Pinochet and managed to have him arrested while Pinochet was visiting London, but the British government refused to extradite him to Madrid, saying Pinochet was in poor health.
Pinochet died in Chile in 2007.