An Albert Lea man is in custody after allegedly holding a person hostage in his home on Friday. A caller told police about a domestic dispute and said a man with a gun was holding a hostage. Upon arrival, police discovered the suspect in the backyard of the home. When the suspect was detained, officers found a firearm in his waistband. The man was arrested for possession of a firearm, making terroristic threats and domestic assault. Formal charges are pending.