A spokesman for the Berlin prosecutors' office said that the 48-year-old had been arrested at the same time as the manager of a security firm.
As a department head at the Berlin Health and Social Affairs Office (Lageso), the official who was arrested was responsible for awarding contracts for the management of refugee homes.
He would only agree to new contracts if one specific security firm was hired to guard the accommodation centres, prosecutors say.
Prosecutors said that more than €51,000 in cash had been found in a safe in the man's home, where they also seized files and electronic records and a car.
The man received between €5,000 and €10,000 in bribes for each contract he awarded to the security firm, Focus magazine reported.
A spokeswoman for Lageso told Focus that they were supporting investigators “completely” so as to uncover the truth of the case.
The man under suspicion has been “discharged” from his post, she added.
Berlin's Lageso has been in the headlines for all the wrong reasons since the refugee influx intensified in the second half of 2015.
The long queues of refugees waiting to be assigned accommodation or to receive money for food have become a notorious symbol of struggling organization in the capital.
Conditions became so bad that the head of the office was forced to step down in December.