The ‘Careless Whisper’ singer lost control of his Range Rover in the early hours of Sunday morning (04.07.09) after attending the Gay Pride parade in London on Saturday (03.07.10) and ploughed into the door of photo store Snappy Snaps.
The 47-year-old pop star – who only recently ended a two-year driving ban - was arrested by police at 3.35am on suspicion of being unfit to drive.
The Hampstead shop in north London was left with a broken door and shattered windows from the force of the impact. George was released on bail until next month.
A police spokesman told Britain’s The Sun newspaper: “A man in his 40s was arrested on suspicion of being unfit to drive.”
The singer’s spokesman has so far refused to comment on the incident.
George's erratic behaviour once again raises concerns over his lifestyle.
He was arrested in September 2008 after being caught in a public toilet in possession of crack cocaine and marijuana.
A year previously he was handed 100 hours community service for drug driving after being found slumped at the wheel of his Mercedes car by police.
In a frank interview last year the ex-WHAM! star insisted he had cut down his marijuana use, smoking only "seven or eight" cannabis-laced cigarettes a day from 25.
George - who is in a long-term relationship with art dealer Kenny Goss - also admitted he was frustrated that people judge him for his drug use and penchant for casual gay sex.
He said: "People want to see me as tragic with all the cottaging and drug-taking. I don't see them as weaknesses any more. It's just who I am.
"I've done different things at different times that I shouldn't have done, once or twice, you know. Of course, nobody wants to regularly smoke crack."