He drove to Yangon in a rented car on Sunday, checked into room 921 at the Traders Hotel, and attached a small bomb to the back of the toilet, setting the timer to go off within 48 hours, Zaw Win said.
It detonated late Monday, injuring a 43-year-old American woman who was visiting the country with her husband and two young children.
Other bombs all primitive and locally made have been planted at a restaurant, a bus stop, near a market and near a Buddhist monastery in five cities.
The goal, the police chief said, "was to stop foreign involvement in the local market economy."
Small bombings occurred frequently in Myanmar during 50 years of military rule. But they have been rare since the nominally civilian government of President Thein Sein took office in 2011 and started implementing political and economic reforms.
Many activists and rights groups, however, say the country is still far from free and the government is struggling to contain sectarian violence and long-running ethnic insurgencies.
Representatives of the Karen National Union signed a cease-fire agreement with the government last year and Ye Htut, a presidential spokesman, said individuals, not the group itself, were to blame.
He said the KNU has been cooperating with authorities to identify the culprits.
Saw Myint Lwin joined the ethnic insurgency at the age of 16 and left five years later in 2008 and began working in a mine, where he met "Nato," the alleged mastermind of the attacks, the police chief said.
He was invited to Mon state last month to discuss the plot, Zaw Win said.
Hours after planting the Traders Hotel bomb, Saw Myint Lwin attached a second device to the bottom of a table at a restaurant in Yangon, but it was spotted by staff who notified authorities, police said.
That ultimately led to his arrest. Identified as a possible suspect, he was placed under surveillance, and police moved in after matching his photograph with images captured by a Traders Hotel closed-circuit television camera.
Saw Myint Lwin rode his motorcycle through a barricade set up to apprehend him, but police were able to catch up with him.
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Associated Press writer Esther Htusan contributed to this report.