The 55-year-old man from Caroline Springs was arrested about 5.30pm on Monday, Victoria Police said.
He will be interviewed by detectives on Tuesday and no charges have been laid.
Mr Hill, 74, and Ms Clay, 73, were last heard from on March 20, 2020, while camping in the Wonnangatta Valley.
Mr Hill left his Drouin home on March 19 and picked up Ms Clay from her home in Pakenham in his white Toyota LandCruiser.
He was last heard from on March 20 when he made a call via high frequency radio saying he was at Wonnangatta Valley in the Victorian Alps.
During the call, the experienced outdoorsman said he was having radio transmission issues.
Ms Clay, a former Victorian Country Women's Association president, told friends she was heading away and expected to return home on March 28 or 29.
Investigators were told the couple were camping together at Wonnangatta River near the Wonnangatta camping ground.
Campers found Mr Hill's fire-damaged car at their campsite, which was completely destroyed by fire, near Dry River Creek Track on March 21.
The pair have not been seen or heard from since.
Multiple searches have been conducted in and around the Wonnangatta Valley, including with cadaver dogs.
Earlier this month, police released images of a blue four-wheel-drive - believed to be a mid-to-late-1990s model Nissan Patrol - taken by a safety camera in the area at the time Mr Hill and Ms Clay went missing.
Witnesses reported a number of sightings of the vehicle including near the campsite, with police yet to track down the driver or exclude them as a person of interest.
Police believe the pair may have had an altercation with another camper, possibly the driver of the blue 4WD.
It was towing a trailer and heard performing a 20 to 30-point turn on a narrow track the night the pair vanished.
Mr Hill's sister Jill knew the pair were in a secret relationship despite Mr Hill being married.
She believes that was part of the reason they travelled remotely together for their trips.
The families have been desperate for answers and recently gave television interviews on the uncertainty surrounding what happened to their loved ones.
"It's hard. It's not getting any better not knowing. You can't grieve for someone if you don't know really missing or dead," Mr Hill's daughter Debbie told Seven News last month.
Premier Daniel Andrews said it had been a "very difficult couple of years for all of us".
"When some of these tragedies happen, what may well be a tragedy, it just brings home all that we've done, all that we've given, and the things that matter most, and it's safety," he told reporters.
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