A 59-year-old man was arrested yesterday morning, North Yorkshire Police said.
He had been named locally as Michael Snelling.
Officers said Miss Lawrence, who went missing from her home in York in March 2009, has not been found.
Mr Snelling's house in Burnholme Grove, York, was the subject of an intensive police search after officers arrived at the run-down semi in a quiet cul-de-sac at about 10am. It later emerged another house, in Hollywell Road, North Shields, Tyneside, was also being searched.
People living near Mr Snelling in York said they were shocked about the police activity in their street.
Neighbours said he had worked at York University as a lab technician until recently and he had lived in the house for more than 20 years. One woman, Rita Harrison, said the area was "lovely" and "very quiet". "Everyone's shocked," she said. "But they need to get to the bottom of it."
Mr Snelling's house is about half a mile from the small house where Miss Lawrence lived by herself in the Heworth area of York.
Police officers and white-suited forensic scientists could be seen coming and going from the property throughout the day.
Contractors arrived to board up the doors and some of the windows and uniformed police cordoned off the property with tape.
Miss Lawrence, who worked in a kitchen at York University, was 35 when she was reported missing by her father, Peter, on March 20 2009. She was last seen at about 3.05pm on March 18 walking back towards her home.
North Yorkshire Police launched a review of the investigation last year after a new major crime unit was established by the force.
A force spokesman said a car had been seized as part of the inquiry and further arrests were not being ruled out.