Hassan and a former aide directed the Baathist strain of the insurgency from Syria, where they had access to funds and directed a network of Iraqi army veterans, intelligence chief Mohammad Abdullah al-Shahwani told AFP in January.
Two other half-brothers of Saddam, Barzan and Watban, are already being held at a US army-run jail near Baghdad and are set to be tried in the coming months.
Hassan was one of about a dozen of the most wanted officials who have so far escaped arrest or death at the hands of American-led security forces. He was the six of diamonds in the deck of cards US authorities issued with pictures of the fugitives.
The most senior figure among former regime officials still at large is Ezzat Ibrahim al-Duri, Saddam's former deputy. He has a 10-million-dollar bounty on his head.
Detained former regime leaders face charges of war crimes, crimes against humanity and genocide, any of which could result in a sentence of death by hanging or firing squad.
News of Hassan's arrest came as the US military in Baghdad transferred responsibility for security to a new army division returning to Iraq for the first time since taking part in the 2003 war to oust Saddam.
The 3rd Infantry Division formally took over authority for Task Force Baghdad at a ceremony under the giant crossed sabre monument in the capital that commemorates the 1980s Iraq-Iran war.
Transferring control to Iraqi security forces has been a mantra for US officials and military leaders since the 2003 invasion to oust Saddam.
But the process has taken far longer than envisaged. Iraqi security forces have suffered from infiltration and intimidation by insurgents, and in some instances have either refused to fight insurgents or have fled.
Unrest continued on Sunday across Iraq. A bomb blast hit the city hall building in Hamma al-Alil, killing at least five people and wounding three others, Iraqi officials said.
The US military put the dead at eight and the number of wounded at two in the attack 20 kilometres south of Mosul, where US troops and insurgents have battled since November.
In Suweira, south of Baghdad, the bodies of five men dressed in Iraqi army uniforms were found late Saturday with their throats cut, according to a hospital doctor in the town of Kut, to where the bodies were transferred.
In the nearby town of Musayeb, four Iraqi civilians and a policeman were wounded on Sunday when a car bomb exploded near a taxi and minibus station, police and hospital sources said.
Two US soldiers were killed in a bomb and gunfire attack in the Iraqi capital on Saturday, the US army announced Sunday.
"Two Task Force Baghdad soldiers were killed and two others wounded after a combined improvised explosive device and small arms attack in south-east Baghdad February 26," the military said in a statement
The American military also announced on Sunday that a US marine was killed in action on Saturday in the violence-plagued province of Babil, south of Baghdad. Britain's Independent newspaper, citing government documents, meanwhile reported that Prime Minister Tony Blair may have committed himself to the invasion of Iraq nearly a year before the US-led assault began. The Sunday Telegraph, another British weekly, reported that almost 50 more British troops were facing prosecution for murder, manslaughter, assault and other crimes in Iraq.