Police did not name the woman - although it is being reported by a number of outlets to be Rosdeep Kular, the toddler's mother.
The development was announced late tonight by Police Scotland Assistant Chief Constable Malcolm Graham, who said: "During the course of today, the investigation into the disappearance of Mikaeel Kular has continued at pace.
"Following formal identification, I can now confirm that a 33-year-old woman has been arrested and charged in connection with Mikaeel's death.
"The woman is expected to appear at Edinburgh Sheriff Court on Monday."
The three-year-old was reported missing in the early hours of Thursday morning from the family home in Edinburgh.
It was reported that Mikaeel was last seen on Wednesday night when his mother put him to bed at their home in Ferry Gait Crescent in Edinburgh at 9pm.
She reported him missing after going to check on him at 7.15am the following day and finding he wasn't there.
The little boy, who had two sisters and two brothers, usually slept in the same room as his twin sister but was alone in another room on Wednesday night.
After the alarm was raised, hundreds of volunteers from the local community joined emergency services in the search Mikaeel.
His body was found in Fife, a region north of Edinburgh across the Firth of Forth.
His remains were removed from the scene earlier today for further examination.