"The intelligence service was able to arrest the wanted man Abd al-Baqi al-Saadun," Abadi announced in a televised speech.
A senior intelligence officer said Saadun was arrested on Thursday "without resistance" in the northern province of Kirkuk following an operation that lasted more than a year.
Saadun held various senior positions in Saddam's Baath party, and the US military had previously said he was wanted for crimes against humanity committed during the suppression of a 1999 Shiite uprising.
Izzat Ibrahim al-Duri, the most senior Baathist still at large, was said to have been killed earlier this year, but Iraq later admitted it lacked the necessary DNA results to confirm his identity.
And an audio recording attributed to Duri was subsequently released that contained references to events after his supposed death.