Malik, chairman of the Jammu and Kashmir Liberation Front (JKLF), along with dozens of his supporters tried to take out a protest march from his office in Maisuma towards city centre Lal Chowk.
The JKLF march was part of the group's demand for the return of the mortal remains of Afzal Guru to his family.
Syed Ali Geelani was placed under house arrest.
Police and Central Reserve Police Force (CRPF) personnel intercepted the march at Maisuma and took Malik and some of his supporters into preventive custody.
Malik has been evading arrest for the last few days since the announcement of his decision to lead the march Sunday.
All other senior separatist leaders have been taken into preventive custody by the police except for Syed Ali Geelani, who was placed under house arrest immediately after he arrived here from Delhi Saturday.
Security forces have imposed restrictions in parts of Srinagar city and some other major towns of the Kashmir Valley to maintain law and order.