Federal agents in Tijuana have arrested Dr Francisco Javier Valentin y Ortiz, who worked at a state-run clinic.
He is accused of negligent injury, medical malpractice and performing surgery without the proper medical certification.
The alleged amputation happened in September 2000 when a man visited the clinic for a routine circumcision operation, in which only the foreskin of the penis is removed.
This is a relatively technically simple operation, which can be carried out under local anaesthetic with the patient allowed to go home shortly afterwards.
Bleeding
Risks include excessive bleeding - the removal of too much or too little skin, or cosmetic results which do not please the patient.
Full recovery requires four to six weeks of abstinence from sexual activity.
There are many reasons why adults may want to be circumcised, including medical conditions which make them prone to infection, and cultural or social reasons.
The name of the patient in this case has not been released.
Officials said that the arrested surgeon was licenced only as a general surgeon and not qualified to perform circumcisions, which require a specialisation in urology.