A teenager died at the Conquest Hospital after the car he was in collided with a parked van in Holliers Hill in the early hours of Thursday morning.
The driver, also 19, ran away but was found at an address in Catsfield where he was arrested just after 9am on suspicion of causing death by dangerous driving and he was taken into custody for interview and further enquiries.
It is thought the green Citroen Saxo crashed into the van on the other side of the road and ended up on the grass verge outside Kipling Court.
A resident of the block of flats told the Observer: “All I heard was seriously slamming brakes. The screeching of brakes, and then a massive crash. There was no way we could see anything, but I heard moaning from the vehicle.
“It was just horrible. It happened just outside the building, and I could just see the vehicle on the bank of grass outside, the front of it, with the doors open.”
Another resident from the block said: “There have been so many accidents here. They come around that corner so fast. It doesn’t surprise me.”
The other two passengers - a man, aged 18 and a woman, 19, were taken to the Royal Sussex County Hospital in Brighton with serious but not life threatening injuries.
Sergeant Dave Morgan of the Sussex Roads Policing Unit at Polegate said: “We are asking anyone who saw what happened, or who saw the Saxo in the area immediately beforehand, to contact us via 101 or email us at ‘firstname.lastname@example.org’, quoting Operation Account.”