Officers arrested 22-year-old Andrew Derose Thursday afternoon after responding to a report of someone with a gun on G Street near 21st Street.
When officers arrived, they found a victim and learned the gun was used in a kidnapping.
As investigators were speaking with the victim, Derose walked out of an alleyway with the weapon. He then carjacked a vehicle.
Officers found Derose during a traffic stop. They seized the gun and took him into custody.
Derose is in the Merced County Jail being held on a $260,000 bond.