Loyalist leader Colin Lindsay, known locally as "Bap", has died after being attacked in his south Belfast home by a man wielding a samurai sword.
Police in Northern Ireland said in a statement given to IBTimes UK that they have arrested a 46-year-old man on suspicion of murder and attempted murder.
A 57-year-old man, also injured in the attack, is said to be in a critical condition in hospital.
Stormont assembly member Jimmy Spratt has asked for calm in the aftermath of the attack. He added that tensions were already high in the Northern Irish capital as protestant marching season approaches.
"I want to condemn the murder of a man last night in the Belvoir estate," the Democratic Unionist Party representative said.
"Murder has no place in our society and I would urge anyone with information to contact the Police Service of Northern Ireland immediately. I would also appeal for calm in the area especially at a time of year when tensions are high."
Lindsay was the head of the Ulster Defence Association, the largest loyalist paramilitary organisation in Northern Ireland.
Sectarian tensions in Belfast become particularly heightened during marching season when the city's unionist community (traditionally Protestant) parade through nationalist (traditionally Catholic) neighbourhoods. The largest of the parades commemorates the Battle of the Boyne, a Protestant victory in 1690.