Oliver Schulz, 41, is the first Australian serviceman or veteran to be charged with a war crime under Australian law.
The offence carries a maximum sentence of life in jail.
He was arrested on Monday in regional New South Wales (NSW), and will face a court on Tuesday.
The Australia Broadcasting Corporation (ABC) says Mr Schulz is the person referred to as Soldier C in a 2020 ABC Four Corners documentary exposing alleged war crimes.
Footage showed Soldier C shooting an Afghan man in a wheat field in Uruzgan Province in southern Afghanistan in 2012.
