German police said they had arrested Mr Puigdemont in the northern state of Schleswig-Holstein.
The arrest comes two days after Spain's supreme court issued global arrest warrants for 13 Catalan separatists including Puigdemont and his nominated successor Jordi Turull over their role in the region's failed bid for independence.
On Friday the Spanish government reactivated an global arrest warrant for Puigdemont, who is wanted on charges of sedition, rebellion and misuse of public funds.
While separatist parties won Catalonia's regional elections in December called by Madrid, they have been unable to form a government as they have picked candidates are now either in exile, in jail or facing prosecution.
Puigdemont is wanted by Spain on charges of "rebellion" and "sedition".
Puigdemont was taken into custody as he travelled from Finland back to Belgium.
A Spanish judge reactivated an global warrant for Puigdemont and five other fugitive separatist leaders from northeastern Spain on Friday.
Mr Puigdemont was arrested by German police near the Danish border
Outside of the German consulate demonstrators held up a photo of German Chancellor Angela Merkel sporting a Hitler-style moustache.
It is not clear if Puigdemont will be immediately extradited from Germany. He departed Finland on Friday after giving a speech at a university before authorities could arrest him on charges in Spain that could result in 30 years in prison.
"The president was going to Belgium to put himself, as always, at the disposal of Belgian justice", said Joan Maria Pique, Mr Puigdemont's spokesman. Mr Turull was among five people taken into custody in fresh arrests.
Issuing the warrant for Puigdemont on Friday, Judge Pablo Llarena accused the ousted Catalan leader of organising an independence referendum in October a year ago despite a ban from Madrid. Their detention sparked protests across Catalonia.
In 2016, he became leader of Catalonia and led the region to the referendum the following year.
On Friday, Spain's Supreme Court ruled that a total of 25 Catalan leaders would be tried "for rebellion, embezzlement or disobedience".
Thousands of Catalan separatists hit the streets of Barcelona on Sunday, vowing the arrest of former Catalan president Carles Puigdemont in Germany would not stop their push for independence.