Tatchell, dressed in black clothing and a black beret with a red star on it, resisted police and was at one point seen struggling on the ground while officers attempted to arrest him.
The Melbourne-born 60-year-old wanted to protest what he saw as the president’s personal involvement in the bloody repression of Aceh and West Papua and abuse of political prisoners.
Protesters from various human rights groups demonstrated against Mr Yudhoyono, who arrived in the UK on a three-day state visit which included a gala dinner hosted by the Queen at Buckingham Palace.
Tatchell was later released without charge despite claiming he was also attempting a citizen's arrest of the Indonesian president.
"The president stands accused of crimes against humanity in East Timor and West Papua, involving the deaths of thousands of people," he said.
"I am saddened that some police officers apparently have no respect for freedom of expression and the right to peaceful protest."