His brother, ousted Prime Minister Nawaz Sharif, was sentenced earlier this year to 10 years in prison after the Supreme Court removed him from power.
Pakistani opposition leader Shehbaz Sharif was arrested on Friday in a longstanding corruption case, the country's anti-corruption agency said, in a move taken nine days before crucial by-elections are due to be held.
His brother, ousted Prime Minister Nawaz Sharif, was sentenced earlier this year to 10 years in prison by the same agency after the Supreme Court removed him from power.
Friday's arrest, by agents of the National Accountability Bureau (NAB) in Lahore, involved a case of alleged corruption in a low-cost housing scheme, called Aashyana (Shelter), when Shehbaz Sharif was chief minister of Punjab province.
Aashyana company case
"NAB Lahore has arrested former chief minister of Punjab Shehbaz Sharif in Aashyana company case. NAB will produce the former chief minister of Punjab in the honourable accountability court tomorrow," a statement from the agency said.
A NAB spokesman Nawazish Ali initially said the arrest was linked to a separate long-running case involving alleged corruption in a water purification project, but he later said it was related to the housing scheme case.
Nawaz Sharif has denounced corruption cases against him and his party's leaders as politically motivated, and both brothers deny any wrongdoing.
The former prime minister was arrested 10 days before the July 25 election, which was won by cricket star turned politician Imran Khan, who now leads the new government.
The Sharifs' Pakistan Muslim League-Nawaz came in second place in the election. Their party, along with all other major opposition parties, denounced the polls as rigged.
By-elections to fill 11 parliamentary seats and 19 provincial assembly seats are scheduled for October 14.
Those seats remain empty because of court-ordered delays and the ability of leading candidates to run in several constituencies at once, but only represent one.
The outcome of the by-elections could affect the slim majority Khan's coalition government holds in parliament, though many of the constituencies are considered strongholds of his Pakistan Tehreek-e-Insaf (PTI) party.
The contests are considered to be closer in the provincial assemblies and could result in the PML-N winning back control of Punjab.