The 20-year-old player, whose name was withheld, was accused of groping a 25-year-old woman working in a laundry room at the athletes' village.
"He was banned from leaving the country. We have questioned him and we will hand over this case to (state) prosecution authorities soon," Chief Superintendent Kim Hyun-Ja of the Namdong Police Station in Incheon told AFP.
Prosecutors will decide whether formal charges should be brought, Kim said.
It was the second such case involving foreign participants in the Asian Games which formally open in the South Korean port city of Incheon on Friday.
The man allegedly sexually harassed a 21-year-old female volunteer at a football stadium in Ansan.
In both cases, neither suspect was taken into custody.
