A 50-year-old man has been arrested on suspicion of the indecent assault and murder of Stuart Lubbock at the home of Michael Barrymore.
Mr Lubbock, 31, was found dead in the TV presenter’s pool in Roydon, Essex, in March 2001.
The man was arrested in Cheshire and is being questioned in custody, Essex Police said.
Mr Lubbock had been attending a party at the home of Mr Barrymore, 68, with eight other people.
A post-mortem examination found Mr Lubbock had suffered “horrific” injuries prior to his death, police said.
Alcohol, ecstasy and cocaine were found in his bloodstream.
No-one has ever been charged with any offence in relation to the death.
Reacting to news of the arrest, Mr Lubbock’s father Terry said: “There is just so much going on in my head. I can’t get my head around it.
“Of course I’m happy. Of course this is good news. But it’s been 20 years. This has nearly killed me.”
In February, the 76-year-old from Harlow said he had only months to live after being diagnosed with terminal cancer.
“All I’ve been living for is to get justice for Stuart,” he said.
Mr Barrymore, who became a household name for shows such as Strike It Lucky, has always denied involvement in the death.
Speaking last year, he said: “I have had nothing to do with this whatsoever and yet I keep getting bashed and bullied by the media.”
An inquest into Mr Lubbock’s death, in 2002, recorded an open verdict.
Three years ago, the then-attorney general, Jeremy Wright, refused to let Terry Lubbock make a High Court application for a second inquest.
In 2009, the police watchdog published the findings of a review of the investigation into Mr Lubbock’s death, concluding that officers missed crucial evidence and did not ensure vital forensic tests were completed until six years later.