mistaken identity

state of illinois, what action should i take if someone steals my drivers license and starts using it fradulently for criminal purposes which results in an unwarranted arrest

You should immediately cancel your license at the Department of Transportation and explain your situation(you will most likely have to apply for a new license). Ultimately, you will have to prove your involvement in illegal activity to be false through alibi or other means in court. What crime was the warrant issued for? What illegal activity took place? Are you prepared to turn the person who committed the crime(s) in?