The case was registered on the basis of a complaint filed by a woman who alleged that she had been sexually abused by Thettayil and his son Adarsh at a flat in Aluva last year, police sources said.
A detailed inquiry is on, they said.
Thettayil, a JD(S) leader and former transport minister, said he would face the case legally and claimed that it was a "political conspiracy" against him.
The MLA from Angamally said he knew the woman as she had approached him to get married to her son.
The development might come as a setback to the opposition CPI(M)-led Left Democratic Front which is going hammer and tongs at the ruling Congress-led UDF over the solar scam.
LDF has been disrupting assembly sessions since the past week over the issue.