The Zaka emergency service said the rabbi, 49, was walking with a bodyguard in Jerusalem's walled Old City, where his seminary is located, when he was attacked. The bodyguard gave chase but the attacker escaped, leaving behind a blood-stained knife.
According to police, the unidentified assailant stabbed the man once and fled the scene. Security forces are currently searching the area in hopes of capturing the attacker.
The man was taken to Hadassah Hospital in West Jerusalem for treatment.
The Damascus Gate has been a frequent site of terror stabbings in the past.
The attack Tuesday comes less than two weeks after a Palestinian from east Jerusalem shot and killed eight Israeli students at a Jewish religious school in west Jerusalem. Since then, tensions in the city have been high, and on Sunday, dozens of Jewish extremists tried to attack the Palestinian gunman's home.