The incident in question involves a woman at a hotel in South London and Police were called to the hotel in Croydon at 23:30 GMT on Saturday.
He was arrested and has been bailed until a date in late January, pending further inquiries.
A Notts County statement read: "Notts County can confirm that the club are aware of an alleged incident involving one of our players at the team's hotel on Saturday, 3 December.
"As this is a police matter, the club will be making no further comment on this incident."
Hughes was found guilty of causing death by dangerous driving following the death of a man named Douglas Graham in 2004.
He was released after 3 years and joined Notts County in 2009 after two years with Oldham Athletic.