The suspect was booked into jail on suspicion of murder and King County sheriff's detectives are trying to figure out what prompted the killing.
Officers discovered the boy's body in the 19400 block of S.E. 267th St. a residential street in Covington about 5:30 Saturday morning.
They found signs the boy had been beaten.
"It's a tragedy all the way around," Sgt. Jesse Anderson of the King County Sheriff's Office said.
The victim's friends were shocked to learn about the killing and said they'd been hanging out with teenager earlier on Friday.
Police encountered the victim earlier in the evening in the same area and say he was drunk.
"He had been drinking last night," Anderson said. "He was fairly intoxicated and belligerent."
Officers learned the teenager was visiting from Montana and staying with an uncle.
Police returned the boy to his family but say he returned to the Covington neighborhood and got into an argument with the 26-year-old suspect.
The victim's friends said they don't know what happened, and have little information for investigators.
"They asked us if he had hatred with anybody around here we said, 'No, he doesn't really know that many people," a young male friend said.
Calls of a disturbance in the neighborhood started to come in around 3 a.m. Sat. morning, Sgt. Cindi West said.
"Cops this morning came banging on our door," said the friend. "We all got scared."
The victim was a gang member, according to deputies, but the incident Saturday was not gang-related. The boy's name has not been released.
Another man in his 20s was detained earlier as a witness.