The 32-year-old suspect, believed to be a local, sped towards a crowd of about 50 outside the bar at around 1:00 am (2300 GMT Thursday), witnesses at the scene said.
However his white Peugeot ran into barriers set up for a popular weekend festival featuring bull-fighting which attracts thousands of people each year.
Several witnesses told AFP that the man shouted "Allahu Akbar" (God is Greatest) during the incident.
A source close to the investigation said the man was not known to police for suspected radicalisation.
The region's public prosecutor Eric Maurel said the suspect tried to flee but was caught and roughed up by the crowd.
He was in a state of "mental confusion" during his arrest and has been hospitalised, Maurel added.
An investigation has been opened into attempted murder.