Wu was accused last week by 19-year-old student Du Meizhu of date-raping her when she was 17, drawing widespread condemnation of the singer on Chinese social media and leading to luxury brands torpedoing deals with him.
"Wu Yifan, 30, Canadian nationality, is now criminally detained in accordance with the law by Chaoyang branch of Beijing public security bureau on suspicion of rape," police in Beijing's Chaoyang district said in a Weibo statement, using Wu's Chinese name.
Officers said they launched an investigation after Wu was reported by internet users for having "deceived young women multiple times into having sexual relations".
The scandal evokes China's #MeToo movement sparked by Chinese feminists in 2018, where women were empowered to voice their experiences of sexual harassment -- sometimes involving powerful public figures.
Wu originally shot to fame as a member of the K-pop boyband EXO, before leaving in 2014 to launch a successful solo career as a singer, actor, model and variety show judge.
Since Du's accusations, more alleged victims have spoken out online, accusing Wu's staff of predatory behaviour such as inviting them to boozy karaoke parties with the star.
Brands including Louis Vuitton, Bulgari, L'Oreal Men and Porsche last week suspended their partnerships with him as a result of the escalating fallout.
The star has denied all allegations of assault and insisted he was innocent in multiple social media statements last week.
His lawyers are suing Du for defamation, and the student has said she is taking legal action against Wu.