The six-year-old was with her family in Rowheath Park, in Birmingham, when the offence took place around midday on Saturday.
Police believe the girl was "momentarily" lured into a nearby wooded area and stepped up patrols in the area to help reassure people.
Now the force has said a 16-year-old boy, from Birmingham, has been arrested on suspicion of sexual assault and is in custody for questioning.
West Midlands Police said the investigation is still ongoing and they will continue to support the girl and her family.
Detective Inspector Matt Stone, from the public protection unit, said: “This arrest is a significant development as our investigation continues at pace.
“I’d still urge anyone with any information, who hasn’t yet contacted us, to do as soon as possible.
“There have been lots of comments on social media. I thank people for sharing our appeal, and those who got in touch with information. However I’d ask that people do not speculate on the circumstances, its unhelpful to our investigation and distressing for those involved."
Anyone with any information can message the force via Live Chat on our website or call 101 quoting crime number 20/749042/21.