The drug consignment was allegedly being transported in a SUV on the Karala-Bawana Road in outer Delhi, the police said.
The arrested have been identified as driver Chamling Amol, 24, and general store owner Madhav Goutam, 40. While Amol was arrested with the drug outside the city, Goutam was later arrested from Lucknow.
The two were smuggling the drugs to Delhi for an interstate syndicate that also supplied the narcotics to other states such as Uttar Pradesh and Bihar.
"A Special Cell team had been keeping a watch on the activities of this syndicate for five months and knew the identities of the suspects. On Sunday, the police received a tip-off about drugs being moved in a SUV on the Karala-Bawana Road. Following this, a trap was laid and the SUV was seized with 25 kilos of the drug and Amol arrested," DCP, Special Cell, Sanjeev Kumar Yadav, said.
However, Goutam, whom police suspected would be in the vehicle, was not present.
"We found that Goutam had stayed back in Lucknow to meet an associate. Amol disclosed his location after which he was arrested from Lucknow on Monday," said Yadav.
Police said that the gang would procure raw materials from Manipur's border with Myanmar, turn it into heroin and then transport it to Delhi and other states along the way.
"A portion of the drugs seized was to be sold to a man in JJ Colony in Bawana. We have also seized a mobile phone and some SIM cards from the vehicle and are using the information recovered from it to identify the heroin buyers in Delhi as well as other people involved in the manufacture and supply chain in Manipur," the DCP said.
( With inputs from IANS )