Former chief of staff in the Egyptian army, Sami Anan, has been detained after announcing his intention to run for president.
Mr Anan has been accused by the armed forces of violating Egypt's military code, running for the post without permission and forging documents.
He was widely considered to be the last high-profile challenger to Egypt's President Abdul Fattah al-Sisi.
Several others have already discounted their candidacy in the March election.
Mr Anan, who served as the army's chief of staff from 2005-2012, announced his intention to stand against President Sisi on social media earlier this month.
On Tuesday, the Egyptian army broadcast a statement on state television accusing the former general of a "serious breach of the laws of military service".
It said that Mr Anan was "blatantly inciting" against the Egyptian armed forces to try and "drive a wedge between the armed forces and the great Egyptian people".
Mr Anan has reportedly been taken to the Military Prosecutor's office in Cairo.
Speaking to the Reuters news agency, a spokesman for Mr Anan denied he had broken any laws, and blamed "inaccurate reading of Anan's announcement" for the arrest.
News of Mr Anan's detention mean that President Sisi is now heading towards the forthcoming election with most other serious contenders already out of the running.
Ahmed Shafik, the country's former prime minister, withdrew earlier this month amid speculation of foul play.
Mr Sisi has been in power since 2013, after leading a military coup that ousted former leader Mohammed Morsi from power, before winning by a landslide in the 2014 presidential election.
He announced his intention to run for a second four-year term in a televised news conference on Friday.