The suspect, named as Djamal Eddine Ouali, 40, was detained under a European arrest warrant near the southern city of Salerno on Saturday, and questioned in prison by prosecutors, the judge in charge of the preliminary inquiry said.
Salerno police chief Alfredo Anzalone said he was confident Ouali's extradition to Belgium would be approved. A hearing on the matter is scheduled for Friday.
Ouali was held on Saturday evening at a bus stop in a joint swoop involving anti-terrorism officers and a police special operations unit in the town of Bellizzi, an area with a large population of transient seasonal workers, many from North Africa.
Belgium had issued a European arrest warrant for Ouali, suspected of being part of a criminal network that produced fake documents for illegal immigration.
Brussels prosecutors said the network is thought to have supplied fake ID documents to some of the Islamic State attackers behind the November terror assaults in Paris that killed 130 people.
The false papers were "probably" also used by Salah Abdeslam, the sole surviving Paris attacks suspect, they said.
The probe was still determining whether the same network also produced documents for those behind the March 22nd attacks in Brussels that killed 31.
Suspicions were raised after Italian immigration officials checked Ouali's residency permit. Police had been searching for a man with the same name linked to the suspected network since January 6th.
Hundreds of digital photographs were then seized from a counterfeiter's workshop, including three of those who planned the attacks in Paris.
One of those photographed was Najim Laachraoui, a suicide bomber at Brussels airport, reports quoted police as saying.