The woman's body was found by police dog patrols at around 11.30pm after a police operation involving helicopters and officers from Kronoberg, Jönköping and Kalmar had been drafted as fears mounted over the woman's safety.
"We made the judgement that she was in danger and hoped that she would be alive," said Robert Loeffel at Kronoberg police to news agency TT.
The police estimate that the woman is in her twenties.
"We have not yet identified her, but we have information over who she may be," Loeffel said.
A 35-year-old man has been arrested on suspicion of murder. According to the Aftonbladet daily, it was the man who alerted the police that something had happened to the young woman.
The call from the man gave the police indications that there was a chance that the woman could be still alive and massive operation was launched to find her. But the move proved to be of no avail as the woman was found dead in woodland near Lindshammar in Småland.
At around 1.30am the 35-year-old man was formerly arrested on suspicion of murder, the newspaper reports.