Security sources said Said Bouteflika, the former president’s youngest brother, along with Generals Bachir Athmane Tartag and Mohamed Mediene, had been taken into custody for questioning and an "investigation into their activities."
There was no immediate comment from police in Algeria and no more details were provided from the sources, Presstv Reported.
Said was the top adviser to his ailing brother and acted as the country’s de facto ruler after Abdelaziz suffered a crippling stroke in 2013.
Huge street protests calling for a radical change to Bouteflika's government forced the ailing president to resign last month but demonstrators continue to demand the removal of all officials associated with the former administration.
"The arrest of Said is definitely the peak in the dismantling of Bouteflika's system," a top political source, who asked not to be named, told Reuters on Saturday.
Lieutenant General Ahmed Gaed Salah, Algeria’s chief of military staff, has promised to rid the country of corrupt politicians, oligarchs and military officials in order to restore confidence among Algerians.
Bouteflika, who had been in power for 20 years, resigned on April 2 after months of anti-government protests and Abdelkader Bensalah, the former head of the Algerian parliament, took over as interim leader with a pledge to hold free elections in July.
Demonstrators have also demanded that Bensalah as well as Algerian Prime Minister Noureddine Bedoui resign, urging more radical change.
Hundreds of thousands of protesters rallied peacefully in Algiers on Friday, chanting "We will not shut up!” and carrying placards that read "No to military rule."
The Bensalah's interim administration has vowed to hold presidential elections on July 4 but Algerians say voting cannot be free and fair if it is organized within the same judicial framework and by the same institutions as those that operated under Bouteflika.