Coun Marcia Watson, of Bilborough ward, has been accused of assaulting Fiona Kirlew, 28, who is the mother of Coun Watson's grandson.
Police arrested Jorael and Shimone Thomas at the same time. The Evening Post understands they are Coun Watson's children and the arrests followed a conversation about Coun Watson's grandchild's comfort blanket.
It is the second arrest of a city councillor to be revealed by the Evening Post this week. The other was Councillor Hassan Ahmed.
The allegations against Coun Watson relate to an incident which took place at about 9.30pm on October 28 outside her home in Nuthall Road.
Ms Kirlew, of Lenton Boulevard, who has known Coun Watson for about 10 years, is understood to have been left with cuts and bruises after the incident. She was treated by paramedics.
Coun Watson has refused to comment.
A police spokesman said: "Two women, aged 47 and 25, and a man aged 22 were arrested on suspicion of causing actual bodily harm. All have been granted police bail, pending further inquiries, until December 5."A spokesman for Nottingham City Council said they were not in a position to comment. i