The 41-year-old suspect was found in the palace grounds by officers seven minutes after an alarm was activated last evening, according to Metropolitan Police.
The unarmed suspect was arrested on suspicion of trespassing on a protected site after he scaled a palace wall and remains in custody.
"At 20:37hrs (local time) on Wednesday, 18 May, officers at the palace were alerted after a 41-year-old man scaled an outside perimeter wall," a Met Police statement said.
"I am content that our security measures worked effectively on this occasion and at no time was any individual at risk,"added Commander Adrian Usher, head of the Met's royalty and specialist protection.
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The Queen and her husband Prince Philip were in residence at the palace at the time and were informed of the incident this morning.
The suspect climbed over a perimeter wall that runs around the palace in central London.
The Met has declined to reveal at which point of the perimeter wall the security breach took place, or where in the grounds of the palace the man was detained.