The 51-year-old was arrested at an address in Preston, Lancashire, on Sunday evening, with police searches of his property ongoing. "This investigation is by no means over however, we still have a long way to go in piecing together the puzzle".
Friends of the keen singer and horserider said she had last been near Orrell Water Park.
In a tribute on Facebook posted on Sunday morning Lisa Wasilewski spoke of Ellen's love of equestrian and offered sympathy to her grieving family.
18 year- old Ellen Higginbottom had been reported missing when she didn't come home from college on Friday.
"She was such a happy and lovely girl who lit up our lives".
Police searched the area and at about 02:30 BST on Saturday her body was found.
Winstanley College released a statement saying the community was "shocked and mourning the loss of a wonderful young woman". Police said they could not rule out a sexual motive for the killing until forensic tests had been carried out.
"We will be supporting our students, many of whom are Ellen's friends and her Winstanley family, in every way we can as we come to terms with something no one should ever have to come to terms with".
Detective Superintendent Howard Millington described the crime as an "absolute tragedy" and extended his sympathies to her family.
Sixth-former Ellen Higginbottom, 18, was discovered dead on the edge of a field in Wigan early on Saturday 13 hours after she disappeared.
'If you saw anyone acting suspiciously in the area either on Friday or in the days prior, please get in touch with police. Investigating the case DS Millington vowed to leave "no stone unturned" as they hunt the woman's killer Sky News reports.
'Our officers will be patrolling the streets in the area whilst we continue our investigation.
"Once again, I would like to thank the public for their overwhelming support in this investigation".
Anyone with any information is asked to contact police on 0161 856 9908, alternatively call 101 or the independent charity Crimestoppers on 0800 555 111.