Dollar, a thoroughbred cross warmblood horse, went missing from his field in Hinkshay on Saturday afternoon.
Police said they received subsequent reports that he had been led through the German Market at Telford Town Centre, and that two men had tried to take him up the escalator into the nearby Asda store.
Dollar was eventually recovered at the Thomas Botfield pub in Central Square.
His owner said that he had been left "extremely distressed" and was barely able to stand.
He suffers with arthritis in one leg and cannot be ridden, and requires medication to treat the condition.
She said that he had been scared due to the unfamiliar surroundings and at one point tried to climb on top of a police car.
She said that he had been left "traumatised" by the experience, and added that it could have been dangerous for members of the public.
A spokesman for West Mercia Police said: “Officers received a report on Saturday, December 3, at around 2.45pm that a horse had been taken from a field on Hinkshay Road in Hinkshay, Telford.
“Then at about 3.15pm a further report was received to say two men were seen walking a horse around Telford Town Centre, before they tried to enter the Asda store with the animal.
“Officers attended the scene but the horse and suspects had gone. However, the horse was located a short time later outside the Thomas Botfield pub in the town centre and safely returned to its owners.
“A 19-year-old male was later arrested on suspicion of theft and criminal damage, but has since been released on bail as investigations into the incident continue.”