Deputy Mayor Mohan Shrivastava and seven others were arrested late last night from a city hotel, along with girls who were brought from outside the city, Senior Superintendent of Police Manu Maharaj said.
When produced before the court of Chief Judicial Magistrate R K Yadav, they were sent to judicial custody till January 20.
The eight have been charged under IPC 363 (punishment for kidnapping), 376-G (gangrape) and 120 B (criminal conspiracy) and sent to Beur jail here.
Mayor of Gaya Municipal Corporation Vibha Devi and BJP MLA from Gaya Prem Kumar have demanded Shrivastava's resignation from the post of Deputy Mayor.
Shrivastava had unsuccessfully contested Bihar Assembly elections from Gaya town on a Congress ticket in 2005, a Gaya report said.
The election to Gaya Municipal Corporation had been held on apolitical basis.