Hazare, 74, was taken into custody at an apartment in eastern New Delhi early in the morning, an hour before he was due to lead a parade to a public park where he was to begin a "fast unto death".
Hundreds of Hazare supporters gathered outside the flat as he was driven away in an unmarked car, shouting slogans of support for him and his campaign to pressure the government into strengthening a new anti-corruption law.
"Plainclothes police came to the apartment where he was staying and asked him to accompany them peacefully," fellow activist Akhil Gogoi told AFP.
Police said they had also detained Kiran Bedi, a retired senior female police officer who is a key supporter of Hazare, and Arvind Kejriwal, another social activist.
"We are holding Hazare in preventive detention until this evening and then we shall decide what to do with him," police spokesman Rajan Bhagat told AFP, adding that the other two were also in custody.
It was unclear whether Hazare, a devotee of Indian independence hero Mahatma Gandhi, would refuse food while being held but Gogoi said leaders of Hazare's campaign would hold an emergency meeting to plan their next move.
The political opposition accused the authorities of an "absolutely undemocratic" act.
Hazare staged a 98-hour hunger strike in April that led to Prime Minister Manmohan Singh's government allowing him and his supporters to help draft the new anti-corruption law, called the "Lokpal" bill.
The April protest caught the country's attention and was widely supported by celebrities at a time of growing anger over corruption after a string of scandals affecting federal and state ministers.
The proposed Lokpal bill creates a new ombudsman tasked with investigating and prosecuting politicians and bureaucrats, but Hazare wants the prime minister and higher judiciary to come under scrutiny.
Under the draft law, the premier and top judicial figures will be excluded.
Arguing that the law had been watered down, Hazare had planned to begin a second hunger strike on Tuesday.
But police banned the protest, saying that the park was available for only three days and that Hazare had not given an undertaking to limit his fast to that time.
Police had also asked him to ensure that no more than 5,000 supporters would gather at the protest site.
The Bharatiya Janata Party (BJP), a Hindu nationalist group that leads the political opposition in India, described Hazare's detention as an "instigation to aggression".
"It's a bizarre and thoughtless act on the part of the government. It is absolutely undemocratic," BJP spokesman Rajiv Pratap Rudy told AFP.
"The government, instead of sorting out the issue and allowing a demonstration to take place, is carrying out a barbaric act."
In June, police halted another anti-corruption hunger strike in Delhi when officers broke up a protest by yoga guru Swami Ramdev that had attracted national headlines.
Corruption has crept up the agenda in fast-developing India after a series of scandals, notably a telecom licence scam that is thought to have cost the country up to $39 billion in lost revenue.
US State Department spokeswoman Victoria Nuland said last week that Washington counted on India "to exercise appropriate democratic restraint" when handling of anti-graft protests.
India rejected the statement as "needless" and said its constitution guaranteed freedom of expression.
"Those who don't agree with this bill can put forward their views to parliament, political parties and even the press," Prime Minister Manmohan Singh said in his Independence Day speech on Monday.
"However, I also believe that they should not resort to hunger strikes and fasts unto death."
During his April strike, Hazare called for corrupt ministers to be hanged, telling a cheering crowd that "sometimes you need to resort to violence".
COMMENTS (11)
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Vienna,17-08-2011 It is all about claiming the rights of being corrupt and judge corruption by the corrupt themselves.India is not far behind Pakistan in political duplicity of obscurantism,a complex issue to be handled delicately by even a working government. What a waste of time and energy at a time all energies need to be spent keeping vigil at terrorism home grown and imported. Taravadu Taranga Trust for Media Monitoring TTTMM India ---Kulamarva Balakrishna
@Moise: The current Indian government has done a lot of good things, but in terms of corruption and governance (where governance means looking out for the little guy) it has become a joke.
A LOT of Indians support Anna...myself included.
Pak friends can point fingers if they want. But wait and watch, aam Indian admis will clean up our system so it is a model for the rest of the world :-)
@Moise:
We elect the politicians to be our working servants for 5 years...
We don't speak for them... They should speak for us...
today we bow our heads for murder of democracy....shame shame India Congress govt..
Outrageous!
Egregious!
Despicable!
Flagrant breach of Democracy!
presently we have a struggle on corruption and we always fight evils of our society. we will ensure that in world corruption index of countries conducted by transparency international we get better position.now we are ranked 87 china 78 and pakistan 143. indian people will do this all alone.we do not need first america and now china like somebody who depends on them for their survival . govt. has accepted our most of demands and presented the Lokpal Bill in the parliament. differences on some points,we will sort out. we will also pray for our biggest neighbor who is ranked 12 on the list of Failed state in 2011.
This kind of mass movement against corruption shows how people power can work to get rid of corruption. Simply Great!!!
@Moise: we do not do what you always do. keep this sugesstion to yourself only
Is this a joke?
India fanboys support your government corruption with your comments.