Hundreds have been killed in a government crackdown since the unrest began about a year ago
Merera Gudina, the 60-year-old chairman of the Oromo Federalist Congress (OFC) was arrested at his home in the Ethiopian capital Addis Ababa on Wednesday and is being held in an unknown location with three others, said Beyenne Petros, president of the Medrek opposition alliance of which the OFC is a member.
The government confirmed his arrest to the state-controlled Fana Broadcasting Corporate, saying that he was held for "violating (the) state of emergency".
Officials told the broadcaster that Gudina is accused of meeting Berhanu Nega, the leader of a banned group, while he was in Belgium.
Earlier this month Gudina addressed the European Parliament in Brussels, alongside Olympic silver medallist runner and fellow Oromo tribe member, Feyisa Lilesa.
Nega, an opposition activist sentenced to death in absentia, attended the same meeting.
At home in Ethiopia, Gudina has strongly criticised repression of the unprecedented protests that have posed the biggest challenge to the quarter-century rule of the Ethiopian People's Revolutionary Democratic Front (EPRDF).
"This is the first time they are targeting the highest level of leadership. I don't fully understand. Merera has always done things peacefully and played by the rules," Petros said of Gudina, a veteran political leader.
During the Rio games, Lilesa drew attention to an Oromo anti-government movement by crossing his wrists above his head -- a gesture that has become a symbol of the protest movement. He has been in self-imposed exile since then.
Hundreds have been killed in a government crackdown since the unrest began about a year ago, according to human rights groups.
A state of emergency was announced in October, a week after more than 50 people died in a stampede in the Oromia region when security forces teargassed a religious festival where protesters were chanting anti-government slogans.
Since then, official figures show over 11,000 people have been arrested in the Oromia, Amhara and Addis Ababa regions where protests had been centred.
Among those arrested are leaders of small opposition parties, journalists and at least two bloggers.
Ethiopian authorities said last month that 2,000 of those detained had been released after undergoing a "re-education" and "counselling" programme.
A key complaint of the protesters is a political system which has meant that the ruling party holds all 546 seats in parliament.
Ethiopian Prime Minister Hailemariam Desalegn in October promised electoral reforms, but Gudina said this was "too little, too late".