The Nigerian striker, 24, who cost the Premier League club a record fee of £16.6million, was quizzed by police at his £850,000 five-bedroom home in Countesthorpe, Leicestershire.
Officers swooped at his home on Tuesday night in response to a domestic abuse complaint, just hours after his side's 2-0 win over Sunderland
When they found no one in they made inquiries with surprised neighbours.
The former CSKA Moscow forward was finally arrested at 1am yesterday, by two plain-clothed policewomen, after he returned home.
The father-of-two Musa was grilled for allegedly beating his wife Jamila and was released without charge.
A spokesman for Leicestershire Police said: 'A 24-year-old man was arrested yesterday morning at his home address near Leicester on suspicion of common assault.'
A neighbour told The Sun: 'Ahmed is a nice guy. He always has a friendly smile. I don't know anything about his private life.'
Another man in the quiet road said: 'You never hear noise coming from the house. I had no idea the police had been called there.'
Musa was not part of the 18-man squad which beat Sunderland at the King Power Stadium on Tuesday.
It has been reported that he has fallen out of favour under new manager Craig Shakespeare.
The striker, who has more than 60 international appearances for Nigeria, signed for the English champions last July after four years in Russia.
A Leicester City spokesman told the Daily Star: 'We are aware that Ahmed Musa has today cooperated with a police inquiry relating to a disturbance in the early hours of this morning.
'The inquiry has since been closed and no further action is to be taken.
'We see no reason for formal action internally, though Ahmed will be given the opportunity to discuss the matter with football management when the squad returns.'
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