Wallace, 44, is believed to be an "accessory after the fact" in the killing of Odin Lloyd, 27, a semi-pro American football player whose body was found June 17 near Hernandez's house in North Attleborough, about 40 miles south of Boston, the Bristol County District Attorney's Office said.
Hernandez was charged with Lloyd's murder and fired by the New England Patriots football team on Wednesday. Prosecutors said he shot Lloyd five times after becoming upset with him days before at a Boston nightclub.
Hernandez's lawyer, Michael Fee, entered a not guilty plea.
Wallace, who goes by the name "Fish," was last seen driving a silver Chrysler - a vehicle police are also seeking, according to the release.
An official at the Bristol County District Attorney's Office declined to provide any more details on Wallace, his suspected role in the murder, or his relationship to Hernandez.
Another man, Carlos Ortiz, was arrested in Connecticut in connection with the case on charges he is a fugitive from justice, Connecticut prosecutors said on Thursday. Ortiz is expected to be transferred to Massachusetts to face additional charges.