Mr Knight, 60, who was kept overnight at a police station, is due to appear today before Bow Street magistrates accused of armed robbery at the Security Express building in Shoreditch, east London, on 4 April 1983.
The former husband of the actress Barbara Windsor was arrested when he arrived at Luton on a flight aboard a private aircraft. He had been living in Spain since leaving Britain shortly after the raid, and survived numerous attempts to extradite him.
As he left the jet, Mr Knight, tanned and smartly dressed, was flanked by reporters from a national newspaper and a television news crew.
He was taken into custody by immigration officials, escorted through Customs by officers from the airport's police unit and handed over to officers from the flying squad.
He has always protested his innocence over the raid, at the time Britain's biggest cash robbery. During the raid, a gang of masked gunmen forced a guard to hand over keys to the vault by pouring petrol over him and threatening to set him alight.
Scotland Yard said later that Mr Knight also faced a charge of handling stolen money in connection with the Security Express robbery. Mr Knight's solicitor said his client would plead not guilty to both charges and would be applying for bail.
During his time in Spain, Mr Knight lived in a villa at Benalmadena near Fuengirola, where he ran a club, R Knights, and owned an Indian restaurant.
He grew up in the East End of London and started working for an upholstery firm at the age of 14. After that he became a rag and bone man and later moved into the night-club scene, acquiring a number of clubs.