The 24-year-old IT analyst has admitted the crime, said police, for which he could face up to six years in jail.
Motorists were left in shock last week when footage from a Japanese porn film was displayed on an electronic screen in south Jakarta.
The video ran for five minutes on Friday before power was eventually cut.
However the clip had already been captured on many mobile phones and soon spread across social media.
The man, who was arrested in his office, allegedly carried out the prank after seeing login details displayed on the billboard.
"The suspect claims he worked alone," Jakarta Police Chief Muhammad Iriawan told news agency AFP. "But we are still investigating whether he was working alone, whether he had a particular motive or whether he was just fooling around."
Access to pornographic websites is blocked in Muslim-majority Indonesia, which has in the past also banned popular websites such as Tumblr and Vimeo for adult content.
The police chief previously told the Associated Press that the perpetrator could be charged under either the Electronic Transaction Law, which carries a maximum prison sentence of six years and a fine of 1 billion rupiah ($77,000; Â£60,000) or the Pornography Law, which carries a prison sentence of up to 12 years.
Indonesian police have arrested a man accused of hacking into a public billboard in Jakarta and streaming a pornographic film.