Scott Stern, 45, was taken into custody by police in Florida after resigning two weeks ago.
An 18-year-old claimed Stern – who taught wrestling and history at Clearwater Central Catholic High School – ordered him to remove his clothing and grabbed him by the groin and throat while shouting at him.
WFLA-TV has said the coach considered it a form of discipline.
The second victim, a 17-year-old, alleges Stern told him to strip before using a ruler to spank him.
There are fears other teens may also have fallen victim to Stern.
Parents at the school have reacted with shock and anger at the students' accusations.
"I think it's totally inappropriate," said Lisa Watt. "I don't think any coach should ever ever go to those boundaries involving children."