The former Barcelona forward and his brother, who is also his business manager, are expected to face a judge on Saturday who will decide whether to free them or keep them in custody while investigations continue.
Ronaldinho’s lawyer Sergio Queiroz confirmed the arrest to The Associated Press news agency and said his legal team in Paraguay had filed an injunction to release the former footballer and his brother.
Gilberto Fleitas, the head of the investigations unit of the Paraguayan police, said the pair were taken into custody after a judge refused to ratify a prosecutor’s proposal for an alternative punishment.
Their unexpected arrest came just hours after the two brothers appeared set to leave Paraguay and draw a line under a tumultuous stay that began on Wednesday when they were questioned by police after presenting falsified passports on arrival at the Asuncion airport.
Federico Delfino, a prosecutor investigating the case, said he believed the two had been tricked into accepting Paraguayan passports on arrival and recommended that because they had cooperated with officials, they be released after paying an alternative punishment.
However, a judge rejected that on Friday and just minutes later the deal was overturned by the top public prosecutor.
Arrest warrants were then issued for both men, while officers from the organised crime and economic crimes units have been tasked with handling the case.
The brothers were invited to Paraguay by a local casino owner and had arrived on Wednesday to take part in a football clinic for children, and a book launch.
Although he last played professionally in 2015, Ronaldinho is still hugely popular with global football fans for his skills and showmanship.
The 39-year-old was the best player in the world at his peak in the early part of this century.
He was named FIFA World Player of the year in 2004 and 2005 and won the World Cup with Brazil in 2002 and the Champions League with Barcelona in 2006.