A 41-year-old man arrested in connection with the case is tonight being questioned by detectives over the fate of Ms Meagher, an ABC Radio manager who has not been seen since the early hours of Saturday morning.
It is understood the man, from the inner Melbourne suburb of Coburg, is the man captured on a CCTV camera wearing a blue hoodie and approaching Ms Meagher outside a bridal shop on Sydney Road Brunswick, as she was walking the short distance to her house from a bar where she had been drinking with work colleagues.
It was reported that homicide detectives believed the man did not know Ms Meagher and that she had fallen victim to a violent, random attack. Police sources confirmed they were building a murder case.
Police arrested the man this afternoon and are holding him iat the homicide squad’s St Kilda Road headquarters. He has yet to be charged.
The arrest follows the emergence of further CCTV footage that suggested Ms Meagher may have been followed for several hundred metres along a busy Melbourne road in the final moments before her disappearance at the weekend.
The new footage, taken from an art store's security camera about 300 metres from the spot where Ms Meagher was recorded by another camera interacting with an unidentified man in a blue hoodie, has been examined by detectives.
Victoria Police refused to comment on the grainy footage and whether the figures it depicted were Ms Meagher, the 29-year-old ABC employee missing since the early hours of last Saturday morning, and the man in the blue hoodie shown on CCTV footage taken from nearby bridal store.
It is not known whether the man arrested is suspected of being the man in the blue hoodie.
Police would also not confirm a News Limited report that additional CCTV footage shows the same unknown man running towards Ms Meagher.
There are approximately 15 visible CCTV cameras between Bar Etiquette on Sydney Road, Brunswick, where Ms Meagher was drinking with ABC colleagues on Friday night and the bridal shop where she was last seen at 1:43am on Saturday.
Police so far have only released footage from the bridal store camera.
Prior to today's arrest, police flooded the streets of the inner-Melbourne suburb where the Irish national was feared to have been abducted while she was walking home.
Ms Meagher's uncle, Michael McKeon, told The Irish Independent that his family was in "a living nightmare".
"That is how most people would describe it, everything stops until you find the person, life is kind of numb," Mr McKeon said.
A police information caravan has been set up near the corner of Sydney Road and Hope Street, close to where Ms Meagher was last seen on CCTV footage.
Brunswick local Dan Gregson, one of five people captured in the bridal shop footage, said he walked past the man wearing the blue hoodie about a minute before the man stopped to talk to Ms Meagher.
"I don't remember that guy's face, you don't think to pay attention to everyone's face," Mr Gregson said.
"I told the police he was just a nondescript looking guy. There was nothing strange about him or I would have noticed."
Police are urging all witnesses, including people travelling down Sydney Road on trams, cars and taxis that night to come forward with information.