Police thwarted an imminent terrorist attack following the killing of a wanted al Shabaab member in Kwale county.
Coastal region police boss Francis Wanjohi said three other suspects were arrested in the operation; a hand-made grenade and motorbike were recovered.
Wanjohi said the officers raided the hideouts of suspected al Shaabab returnees and killed one of them.
He said detectives acted on intelligence information on a planned terrorist attack within the county.
Police said Idris Aden, who has been on the police radar for a long time, was among those arrested during the operation.
Aden was dispatched from an al Shabab stronghold in Somalia to coordinate terrorist attacks in the Coastal region, the security agencies said on Monday.
Police are investigating if the group was behind recent killing of three Nyumba Kumi officials and reformed al Shabab returnees in Bongwe area Kwale.
The four had come out openly to oppose the extremism ideologies of the militia group, which has managed to radicalize hundreds of youth mainly from South Coast for decades under the watch of security agents.
The slain government agents, Mohammed Juma Mwaguzo, Juma Omar Mwanyota, Hassan Debe and Subira Sudi Mwangole were all shot dead by gun-wielding suspects riding on motorcycle.
The arrest comes days after the police warned of a possible terror attack during Ramadhan.
Inspector General of Police Joseph Boinnet said that the joint security agency networks had noticed several attempts by the terror group to stage attacks in Mandera and Wajir counties.