Teenager Lindsay Rimer was last seen on November 7 1994 when she was going to buy cornflakes from a shop in the town of Hebden Bridge, West Yorkshire.
Her body was found in the Rochdale Canal in April 1995.
The new arrest was made on Tuesday afternoon.
A West Yorkshire Police spokesman said: “A 63-year-old man arrested on the afternoon of November 8 on suspicion of the murder of Hebden Bridge teenager Lindsay Jo Rimer has been released on police bail.
“Detectives are continuing their inquiries.”
The Yorkshire schoolgirl was 13 when she was murdered. Her body was found by canal workers five months after she disappeared, weighted down at the bottom of water.
This April, new forensic leads in the cold case were investigated by West Yorkshire Police.
Detective Superintendent Simon Atkinson said at the time that officers were waiting for the “golden nugget of information that will finally crack the case”.