The mayor of Muncie, Ind., was indicted on Monday on a charge of accepting illegal cash payments , bringing to a head a multiyear federal investigation of corruption allegations that have engulfed his administration.

The mayor, Dennis Tyler, 76, is accused of using his influence to award lucrative contracts and accepting $5,000 from Tracy Barton, the former superintendent of sewer maintenance and engineering for the Muncie Sanitary District, according to a federal indictment. If convicted, Mr. Tyler could face up to 10 years in prison and a $250,000 fine.

Mr. Barton was indicted last year by the United States Attorney’s office for the Southern District of Indiana on charges of conspiracy to commit wire fraud, falsification of documents in a federal investigation and witness tampering.

F.B.I. agents arrested Mr. Tyler at his home on Monday morning, according to an F.B.I. spokeswoman . Mr. Tyler appeared in a federal courthouse in Indianapolis on Monday afternoon and pleaded not guilty to the charges , according to United States Attorney Josh J. Minkler. Mr. Tyler’s office did not respond to a request for comment on Monday. A lawyer for Mr. Barton, Michael J. Donahoe, declined to comment on Tuesday.