Mountbatten-Windsor was arrested on Thursday, his 66th birthday, on suspicion of misconduct in public office over allegations he sent confidential government documents to disgraced financier Jeffrey Epstein when he was a trade envoy.
The former prince was released under investigation after being held by police for more than 10 hours.
He has not been charged with any offence but looked haunted in a Reuters photograph after his release, slumped in the back of a Range Rover, eyes red and with a look of disbelief on his face.
The photograph of a man who was once a dashing naval officer and reputed favourite son of the late Queen Elizabeth was carried on the front page of newspapers in Britain and around the world, accompanied by headlines such as "Downfall".
Mountbatten-Windsor has always denied any wrongdoing in relation to Epstein, a convicted sex offender who took his own life in 2019, and said he regrets their friendship.
But the release of millions of documents by the US government showed he had remained friends with Epstein long after the financier was convicted of soliciting prostitution from a minor in 2008.
Those files suggested Mountbatten-Windsor had forwarded to Epstein British government reports about investment opportunities in Afghanistan and assessments of Vietnam, Singapore and other places he had visited as the government's Special Representative for Trade and Investment.
The arrest of the senior royal, eighth in line to the throne, is unprecedented in modern times.
The last member of the royal family to be arrested in Britain was Charles I, who was beheaded in 1649 after being found guilty of treason.
King Charles, who stripped his brother of his title of prince and forced him out of his Windsor home in 2025, said on Thursday he had learned about the arrest with "deepest concern".
"Let me state clearly: the law must take its course," the King said.
"What now follows is the full, fair and proper process by which this issue is investigated in the appropriate manner and by the appropriate authorities."
The news broke early on Thursday morning that six unmarked police cars and around eight plain-clothed officers had arrived at Wood Farm on the King's Sandringham estate in Norfolk, eastern England, where Mountbatten-Windsor now resides.
Thames Valley Police officers also searched the mansion on the King's Windsor estate west of London where Mountbatten-Windsor had lived before being forced out amid anger at the Epstein revelations.
Officers said late on Thursday that the royal had been released under investigation.
They said the searches at Sandringham had concluded but the searches in Windsor were continuing on Friday.
While being arrested means that police have reasonable suspicion that a crime has been committed and that the royal is suspected of involvement in an offence, it does not imply guilt.
A conviction for misconduct in a public office carries a maximum sentence of life imprisonment, and cases must be dealt with in a Crown Court, which handle the most serious criminal offences.
