The arrest was made after a tip-off in the busy Aabpara market of the city. The man belongs to South Waziristan tribal region, a police official told PTI.
"He was carrying hand grenades, detonators, batteries, wires and explosives," he said.
Police also suspect that he was planning to prepare a suicide vest for bomber, prompting a manhunt for a suspected would be bomber.
The alleged militant was nabbed in Aabpara, a busy market place, where Canada-based fiery cleric Tahir-ul-Qadri staged his protests in August before shifting to the Constitution Avenue demanding the resignation of Prime Minister Nawaz Sharif.
Pakistan is battling a home grown militancy in the tribal region.
The rebels have killed more than 55,000 people in a more than decade old insurgency.
