The man was arrested in the Strabane area on Tuesday 10th September and remains in police custody assisting officers with their enquiries.
The device was found near Strabane PSNI station and locals say children could have been killed if the device had have been picked up.
Detective Inspector Andrew Hamlin said: “Our investigation is ongoing and I would continue to appeal to anyone who saw anything suspicious in the Church View area on the Friday night (6th September) or the early hours of Saturday morning to contact police.
“I believe an orange Fiat Sedici, pizza delivery vehicle that was hijacked in the area of Mount Sion, Ballycolman, Strabane at 9.40pm was used to place the device in Church View at approximately 9.45pm.
“The vehicle is believed to have travelled along the following route: Mount Sion, Ballycolman Avenue, Bridge Street, Market Street and Church Street.
“It was subsequently abandoned on Evish Road, Strabane.
“If you were in these areas or were travelling along any part of this route between 9.40pm and 10.20pm and have dash cam or mobile phone footage please contact Detectives at Strabane on 101 quoting reference number 371 07/09/19.”
Alternatively, information can also be provided to the independent charity Crimestoppers on 0800 555 111 which is 100% anonymous and gives people the power to speak up and stop crime.