Police have freed Anwar Ibrahim, Malaysia's de facto opposition leader, on bail after holding him overnight in connection with an alleged sex crime, his lawyer says.

"He is freed, he is not feeling well and he's going straight home," Sankara Nair, Anwar's lawyer, said on Thursday.

Anwar, adviser to opposition Keadilan party, was detained at the city police headquarters in Kuala Lumpur for questioning on Wednesday.

He was arrested an hour before he was due to answer charges that he sexually assaulted a young male aide, the second time he is facing sodomy accusations in a decade.

Anwar, 61, has not been formally charged but remains a suspect in the case which threatens to derail his anticipated return to active politics after 10 years.

In an immediate response the US State Department said Anwar's arrest has raised "serious questions and concerns".

"We urge Malaysian authorities to resolve this matter in a manner that builds confidence in the impartial rule of law in Malaysia," Sean McCormack, a department spokesman, said in a statement.

Anwar has said the allegation by Mohamad Saiful Bukhari, 23, was a government conspiracy to prevent him from seizing power following an unprecedented gain by the opposition in the general elections in March.

In 1998 Anwar faced similar charges when he was accused of sodomising a male assistant.

The accusation led to his sacking as finance minister and deputy prime minister and an eventual jail sentence.

His conviction on sodomy charges was later overturned by Malaysia's high court, but he served six years on a related corruption charge.

That case sparked massive street protests for several weeks and police have implemented road blocks and security checks this time around to prevent a repeat of that.