Shortly after gunshots were heard in the capital, Bissau, government sources told the BBC that Embaló had been detained.
The officers then appeared on state TV, saying they had suspended the electoral process, as the West African nation awaited the outcome of Sunday's presidential election.
They said they were acting to thwart a plot by unnamed politicians who had "the support of a well-known drug baron" to destabilise the country, and announced the closure of its borders and imposed a night-time curfew.
Sandwiched between Senegal and Guinea, the coup-prone country is known as a notorious drug-trafficking hub where the military has been influential since independence from Portugal in 1974.
The election results were expected on Thursday - both Embaló and his closest rival Fernando Dias had claimed victory.
Dias was supported by former Prime Minister Domingos Pereira, who had been disqualified from running.
Late on Wednesday afternoon, Embaló told France 24 in a phone call: "I have been deposed."
Government sources have since told the BBC that Dias, Pereira and Interior Minister Botché Candé have also been detained.
The putschists have taken army chief Gen Biague Na Ntan and his deputy, Gen Mamadou Touré, into custody too, the sources say.
Witnesses in Bissau heard gunfire earlier on, at around 13:00 GMT, but it was not immediately clear who was involved in the shooting or if there were any casualties.
Hundreds of people on foot and in vehicles fled, seeking shelter as the shots rang out, the AFP news agency reported.
Later on, General Denis N'Canha, head of the military household at the presidential palace, read out a statement declaring a takeover.
He said officers had formed "the High Military Command for the Restoration of Order" and instructed the population to "remain calm".
Checkpoints have been erected across Bissau and the streets were deserted ahead of the curfew, that was due to start at 19:00 GMT.
Portugal has called for a return to constitutional order, with its foreign ministry urging "all those involved to refrain from any act of institutional or civic violence".
The former Portuguese colony has witnessed at least nine coups or attempted coups over the last five decades.
