The Danish owner of a home-built submarine said a missing Swedish journalist died onboard in an accident and he buried her at sea in an unspecified location, according to police.
Copenhagen police said submarine owner Peter Madsen will continue to be held on preliminary manslaughter charges. Police declined to provide more details.
Kim Wall, a 30-year-old journalist reported to be aboard Madsen's submarine UC3 Nautilus on an assignment, disappeared more than a week ago.
He has denied any wrongdoing.
Ms Wall's family previously told The Associated Press that she worked in many dangerous places as a journalist, but it was unimaginable that "something could happen... just a few miles from the childhood home".
Police earlier said Madsen had reported dropping her off on a redeveloped island in Copenhagen's harbour about three-and-a-half hours into their trip.
Madsen was arrested hours after his 40-ton, nearly 18-metre (60-foot) long submarine sank off Denmark's eastern coast.
Before his arrest, he appeared on Danish television to discuss the submarine's sinking and his rescue.
It was the journalist's boyfriend who alerted authorities that the sub had not returned from a test run, police said.