Father Guy Theunis was detained by Rwandan security officials in Kigali on Tuesday.
Mr Theunis was about to board a connecting flight to Brussels after a week-long trip to the Democratic Republic of Congo.
He has been held for questioning since his arrest.
Judicial officials said his case will be referred to prosecutors expected to transfer it to courts set up to deal with genocide suspects.
He is accused of complicity to commit genocide by allegedly inciting ethnic divisions amid violence during the 100-day killing spree in 1994, officials said.
Some 800,000 mainly Tutsis were slaughtered by Hutu extremists.
The specifics of the charges against him were not immediately clear.
Judicial sources said he was accused of republishing extracts of items from an extremist magazine known as “Kangura.”
They said the publication incited hatred and violence.
Mr Theunis worked in Rwanda from 1970 to 1994 before being evacuated during the genocide and later stationed in Italy.
He belongs to the Missionary Society of Africa (MSA) which said it was stunned by his arrest.
The missionary group has some 1,700 missionaries in 42 nations in Africa.
It insisted he was innocent of the “totally unfounded” charges.
In Rome, SMA’s head Gerard Chabanon said the order had little information about the case or the charges.
“It’s completely unbelievable, we are stunned and shocked, the news is an absolute bombshell,” Mr Chabanon told AFP.
“Given his stated opinions and his commitment, the accusations against him are totally unfounded,” he said.
“But unfortunately, you can interpret the notion of participating in the ideology of genocide in many ways.”
“His past speaks in his favour, he always defended human rights and carried on doing so after being evacuated from Kigali as a matter of urgency after the genocide,” Mr Chabanon said.
In Brussels on Wednesday, Belgian Foreign Minister Karel De Gucht also said he was “astonished” by the charges levelled at Mr Theunis.
He said Kigali had not supplied Belgium with details of the case, and asked for an explanation and information from Rwandan officials.
Several church leaders, including Catholic priests, have been tried and convicted by local Rwandan courts for participating in the genocide.
The Tanzania-based UN-backed court prosecuting the alleged ringleaders of the massacres has indicted three Catholic priests but only one case has thus far gone to trial.