The ladyboy asked the Swedish man, Robin Hedberg, 18, and a friend whether they wanted to ''hang out and have a massage.''
While they were talking, another ladyboy snatched a white IPhone 4s and a driving licence, credit card and ID plus about 4000 baht in cash.
The ladyboys rode away on a motorcycle towards Patong. The pair of suspects were arrested last night around the Otop area of Patong in Rat-U-Tit 200 Pi Road.
They confessed and handed over the stolen iPhone. But the credit card had been used once, before being thrown away, the ladyboys said.
The motorcycle, a black Honda Click, was taken by police.
Nampong Poochai, the rider, and passenger Pairat Janwiang, are due to appear in Phuket Provincial Court, probably tomorrow.
The Phuket Tourist Protection Centre may be called on to expedite the case if the tourists are required to appear in court.
Court officials told a Phuketwan reporter at the court today that no cases have been processed through the protection centre yet.