The teen is accused of sending abusive posts to the Olympic star via the social networking site, following Daley's fourth place finish in the synchronised diving.
Dorset Police revealed the arrest via their own Twitter account just hours after the incident, saying: "A 17-year-old man was arrested by Dorset Police officers in the early hours this morning at a guesthouse in the Weymouth area on suspicion of malicious communications."
The unnamed teen said to be responsible for the messages has been bailed and will return at a future date while authorities continue to investigate the issue, according to Sky News.
He has also been issued with a formal harassment warning by Dorset Police.
Daley said following the experience that he is taking the abuse 'in his stride' and continuing to focus on the Olympic Games.