He said: "This is under no circumstances acceptable, so we have launched disciplinary proceedings and suspended this soldier from duty."
An eighth officer, identified as a 48-year-old former SEK officer now working for another police department, is under investigation on charges of disclosing classified information between 2005 and 2007, said state prosecutor Mathias Proyer.
"According to witness statements, the schooling was conducted through the use of training documents from North Rhine-Westphalia police," Proyer said in a statement.
He said that the other seven officers were not believed to have disclosed any "internal knowledge" to the Libyans.
Germany's Sueddeutsche Zeitung reported that as many as 30 officers might be involved.
Proyer also said that officers from "other states" were suspected in the case, but did not elaborate.
The officers are alleged to have done the work to earn money on their own time through a private firm founded by a former officer in the federal GSG-9 commando unit.
Rainer Wendt, chairman of the German police union, criticised the officers, saying they had damaged the profession's credibility in Germany.
Germany and other European countries have normalised relations with Libya in recent years.
The US rescinded its designation as a state sponsor of terrorism in 2006.