Officers arrested the 47-year-old manager of theater Malacanang Palace and one female stripper, 41, on charges of public obscenity.
Both suspects have reportedly admitted to the allegations.
Malacanang Palace holds a number of types of shows, including pole dancing and samba performances.
Just after midnight on October 25, a male customer appeared on stage with a female dancer who had exposed the lower half of her body, police said. Since that incident, the popularity of the club had increased.
At the time of the raid, approximately 20 customers were inside the premises.
According to the club’s Web site, Malacanang Palace charges customers 5,000 yen for 60 minutes.