Malaysian national police chief Khalid Abu Bakar said in a statement late Thursday that the man, in his 20s, was arrested September 15.
Khalid said investigations showed the man was in contact with a senior Islamic State group leader in Syria, and is accused of providing information on US service members after hacking several servers.
Khalid said the man, who entered Malaysia in August 2014 to study computer science at a private institution, would be extradited to the US.
It said Ferizi, known by his hacking moniker "Th3Dir3ctorY," allegedly hacked into the computer system of a US-based company and stole the personal information on 1,351 US military and other government personnel.
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Between June and August 2015, Ferizi allegedly provided the information to Islamic State group member Junaid Hussain, also known as Abu Hussain al-Britani.
On August 11, Hussain posted a tweet titled "NEW: U.S. Military and Government HACKED by the Islamic State Hacking Division!" which contained a link to a 30-page document, the US statement said.
"This case is a first of its kind and with these charges, we seek to hold Ferizi accountable for his theft of this information and his role in (Islamic State's) targeting of US government employees," Assistant Attorney General for National Security John P.Carlin said in the US statement.