The interrogation is part of the ongoing Case 1000 corruption inquiry into several businessmen bribing Netanyahu and his family, according to Haaretz.
Milchan had earlier given evidence in the case, but this was the first time he was being questioned as a possible suspect.
According to reports, Milchan is alleged to have given expensive presents to Netanyahu and his wife in order to influence Israel's PM and promote his Israeli and international business interests.
Earlier, it came out that Milchan was an arms dealer and served as an Israeli intelligence officer in the late 1970s. He was also reportedly involved in secret deals to promote Israel's nuclear activities.
