The alleged incident occurred Tuesday and a report was taken, police said.
Avenatti, 47, was arrested Wednesday afternoon in the 10000 block of Santa Monica Boulevard by officers with the West Los Angeles station.
He was held on $50,000 bail on suspicion of intimate partner violence and was then released on bail later Wednesday evening. A court date has been set for Dec. 5.
After he emerged from the LAPD station, he issued a brief statement: "I have never struck a woman. I never will strike a woman. I have been an advocate for women's rights my entire career and I'm going to continue to be an advocate. I'm not going to be intimidated from stopping what I'm doing."
"I am looking forward to a full investigation at which point I am confident that I will be fully exonerated."
In a statement issued by his firm, Avenatti also called the allegations "completely bogus" and "fabricated."
Avenatti also thanked the LAPD for their professionalism in handling the case, saying they had no option in light of the allegations against him.
Details of the allegations against Avenatti were not immediately disclosed. The alleged victim and relationship to Avenatti was not identified.
Some initial media reports described the alleged victim as Avenatti's estranged wife.
However, Lisa Storie-Avenatti, who married Michael Avenatti in 2011, told ABC News that there was no incident involving her and she hadn't seen Avenatti for months.
Her attorney released a statement saying there were never any incidents of domestic violence in their relationship and that his wife never knew him to be physically violent toward anyone.
Avenatti's first wife, Christine Avenatti Carlin, also tweeted: "I have known @MichaelAvenatti for over 26 years we met when he was 21 years old and we were married for 13 years. Michael has ALWAYS been a kind loving father to our two daughters and husband to me. He has NEVER been abusive to me or anyone else. He is a good man."
I have known @MichaelAvenatti for over 26 years we met when he was 21 years old and we were married for 13 years. Michael has ALWAYS been a kind loving father to our two daughters and husband to me. He has NEVER been abusive to me or anyone else. He is a good man.— Christine Avenatti Carlin (@avenatticarlin) November 15, 2018
Avenatti later tweeted his thanks to "everyone who has reached out with supportive messages" and said he "will not be intimidated into stopping my pursuit of justice and what is right."
Thank you to everyone who has reached out with supportive messages and offers of assistance. It means the world to me. I have always been an advocate of women's rights and equality & I always will be. I will not be intimidated into stopping my pursuit of justice and what is right— Michael Avenatti (@MichaelAvenatti) November 15, 2018
He represents Daniels in her effort to void a non-disclosure agreement she signed with Trump while he was running for president in 2016. The agreement was over a payment she received to keep quiet about an alleged affair the two had a decade earlier.
The attorney also got involved in the battle over Brett Kavanaugh's nomination to the U.S. Supreme Court when he represented a client who alleged inappropriate sexual conduct by the nominee.
Avenatti has also discussed the possibility of running for president in 2020.
He was scheduled to travel to Vermont this weekend to speak with state democrats, but the group called off the events after his felony arrest.