Dad-of-six Adrian Marsden, 59, was quizzed over allegations he attacked a girl, seven, in the 1970s.
Cops swooped on his home after the alleged victim came forward.
Marsden — who publicly condemned his evil uncle in the wake of the sex abuse scandal — was held for several hours.
He is believed to have denied all the allegations and was last night released on bail as cops carry out further investigations.
Detectives yesterday spoke to his ex-wife Julie Jackson, 58, who married him in 1975.
Stunned Julie told The Sun: “He’s no paedophile. That’s my honest opinion. I was absolutely shocked when I heard he’d been arrested.
The mother of seven, who was a pupil at Duncroft Approved School at the time, said she had performed a sexual act on Savile more than once in return for going to BBC Television Centre in London for his Clunk Click show.
Hint: check the definition of what constitutes ‘Royal Household‘