He was booked on charges of burglary and criminal trespassing.

Williams didn't even have a bond hearing until 4:00 P.M. last night. Bond was set at $40,000 . . . and we hear that Katt paid it right away and walked.

Katt's people say this was all a misunderstanding . . . and it sounds like it was.

The alleged break-in took place at the home of movie producer Barry Hankerson. But Katt has been LIVING THERE for almost a month, because he's shooting a movie for Hankerson.

Sunday night, an employee of Hankerson's called police and reported that Williams had broken into the house with a crowbar, and that he stole $3,500 worth of jewelry and collectible coins.

But Katt's attorney says that Katt and this guy were involved in some kind of dispute . . . so the guy called in a BOGUS burglary report.

As for the $3,500 in loot he supposedly stole, the attorney says, quote, "Mr. Williams wears more than that in jewelry on his person."

He also claims Hankerson has spoken with police to clear this whole thing up. He adds, quote, "The community and law enforcement have been very welcoming and kind to him. This is a misunderstanding which will work out quickly."

(Katt didn't appear to be taking his arrest too hard when they snapped his mugshots. Check out the pics below. . .)

On a related note, last Tuesday a 17-year-old boy called 911 from Hankerson's house to report that Katt was HOLDING HIM AGAINST HIS WILL, and threatening to beat him up.

Katt and this kid were apparently friends . . . but something obviously went wrong. We don't really have any further details, but we do have audio of the 911 call. (--Check it out here . . .)