Then host Steve Harvey apologized, saying he had read the card wrong.
The real winner was Miss Philippines Pia Alonzo Wurtzbach.
Miss Colombia, it turns out, was the first runner-up.
The crown was taken off Arevalo's head and placed on Wurtzbach.
The Assoicated Press reports that after the live broadcast on Fox, Harvey and an executive for pageant owner WME-IMG, an entertaiment company, called it human error.
Harvey is quoted as saying, "Nobody feels worse about this than me."
"I'd like to apologize wholeheartedly to Miss Colombia and Miss Philippines for my huge mistake," Harvey said on Twitter. "I feel terrible."
Had Arevalo been the winner, Colombia would have won the contest two years in a row.
The pageant got attention in June when co-owner Donald Trump made anti-immigrant remarks while announcing his bid to run for the Republican presidential nomination.
The other owner was Comcast Corp's NBCUniversal.
Spanish-language network Univision pulled out of a deal to televise the pageant, and NBC cut ties with Trump.
Trump sued and eventually settled with NBC and bought the network's stake in Miss Universe.
Trump later sold Miss Universe, Miss USA and Miss Teen USA pageants to WME-IMG.