Jamie Dempsey, 33, of Essex, had been wanted by the Serious Organised Crime Agency (Soca) since spring 2009.
Mr Dempsey, who allegedly conspired to supply 299 kilos of cocaine, was held during a raid on a property in Marbella.
His arrest comes after police released the details of 10 suspected criminals hiding out on the "Costa del Crime".
Dave Cording, of Crimestoppers, said: "This is another great result which means that now 50% of the most recent batch of wanted individuals have been arrested."
'Hatchet' Gerard Kavanagh shot dead in Costa del Sol pub
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Gerard Kavanagh was shot dead in a bar on the Costa del Sol Notorious
gangster Gerard “Hatchet” Kavanagh was gunned down by two masked assassins
yesterda...
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