Her attorney said Lohan, recently released from rehab, had "relapsed" and was receiving "medical care."
The actress, 21, was searched in the police station and a "small" amount of cocaine was found in her pocket, says Santa Monica police spokesman Lt. Alex Padilla.
Lohan – who was wearing her alcohol-detection ankle bracelet at the time of her arrest – was booked for DUI, possession of cocaine, transporting a narcotic into a custody facility and driving on a suspended license, says Padilla.
Two Breathalyzer tests determined Lohan's blood-alcohol level was .12 percent and .13 (the legal limit is .08). She also took a urine test, and may face an additional charge of driving under the influence of a controlled substance if cocaine is found in her system, Padilla says.
"Addiction is a terrible and vicious disease," Lohan's attorney, Blair Berk, said in a statement. "Since Lindsay transitioned to outpatient care, she has been monitored on a SCRAM bracelet and tested daily in order to support her sobriety. Throughout this period, I have received timely and accurate reports from the testing companies. Unfortunately, late yesterday I was informed that Lindsay had relapsed. The bracelet has now been removed. She is safe, out of custody and presently receiving medical care."
Detailing the arrest, which was first reported by TMZ, Padilla told PEOPLE that at 1:34 a.m. the police responded to a call of one SUV chasing another. The call originated from a residential section of Santa Monica.
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"The driver who called police turned out to be the mother of Lindsay Lohan's personal assistant," said Padilla. "Just prior to the chase – but I'm not sure exactly how much time prior – the personal assistant had quit."
The mother drove toward the police station, but ended up in the nearby civic center, says Padilla.
When officers arrived, they determined that Lohan was in the white SUV suspected of chasing the other.
After Lohan failed a field sobriety test, she was arrested. However, the two men in Lohan's car were not, says police Sgt. Robert Hernandez.
Lohan later posted $25,000 bail and was released from jail at about 6:30 a.m. Her arraignment was set for Aug. 24.
She was crying and upset but cooperative during the arrest process, said Hernandez.
Lohan's publicist, Leslie Sloane, had no comment.
Last week Lohan quietly surrendered and was formally booked on misdemeanor charges of DUI and hit-and-run stemming from a May car crash. Only 11 days ago she completed a six-week stint in rehab at Promises, a treatment center in Malibu.
That had followed her arrest in May for DUI. Lohan was injured when her Mercedes SL-65 convertible hit a curb on Sunset Boulevard in Los Angeles.
Beverly Hills police said Tuesday they are seeking a felony charge of cocaine possession against Lohan. "Ms. Lohan was never formally booked for possession because we were still investigating that portion of the case," explained Lt. Mitch McCann, spokesman for the BHPD. "But I can confirm ... we are seeking that felony count."
If charged and convicted of both DUI-related incidents (she still has not been formally charged by prosecutors from her arrest in May), Lohan will face a minimum four-day jail sentence. However, her lawyer could argue for rehab or community service in lieu of incarceration.