The driver fought back after being grabbed from behind by a passenger armed with a knife.

The 36-year-old victim was slashed from his cheek to his ear and received wounds defending himself during the incident on Monday night.

The Albury driver picked up the offender – who is now the subject of a manhunt – at the Olive Street rank near Dean Street.

He drove the man less than two kilometres to Nathan Avenue.

The man pulled out a knife after grabbing the driver, cut his face during a scuffle, and fled empty handed. 

Detective Inspector Winston Woodward said the motive was unclear, but it appeared the wanted man hadn’t demanded cash or other items.

“The victim was shaken up after the incident, however he’s travelling along as well as can be expected after an ordeal such as what he’s gone through,” he said.

“He is a young chap and has helped us considerably with our investigations.”

“I don’t know if this is a person wanting to go from point A to point B.

“However, what concerns me is a person, if they did want to go from point A from point B, is armed with a knife in a taxi at 9pm at night.”

It was the second incident where a taxi driver has been targeted on the Border in a fortnight. 

A taxi was stolen in a carjacking in Wodonga on November 9 and crashed into a power police in Albury, with the alleged offender later identified and arrested. 

The victim in Monday's incident was treated by paramedics at the scene. 

The taxi was seized and has been forensically examined. 

Detective Inspector Woodward said police hoped to make a quick arrest. 

“The taxi driver in this instance has done nothing wrong,” he said. 

“He is a business man going about his business, earning a living, and he's been attacked for no apparent motive.”

Residents on Nathan Avenue said they were concerned by what had occurred. 

Many said it was a nice area, but residents in a block of units could cause problems. ​

One woman said there were often drug deals going on in a lane running to Crisp Street. 

Anyone with information can call (02) 6023 9299 or 1800 333 000.

EARLIER: A taxi driver in Albury has had his face slashed by a passenger overnight.

Police are hunting a man, described at this stage only as being about 30 years old, and have appealed to the public for information.

About 8.40pm on Monday the 36-year-old taxi driver was sitting in his taxi at the rank on Olive Street. 

A man entered the taxi and asked to be taken to Nathan Avenue. 

Upon arrival the driver stopped the cab and was grabbed by the passenger around the neck. 

The passenger produced a knife and slashed the left side of the driver’s face causing a 10cm superficial laceration. 

The offender fled from the taxi on foot and the driver contacted emergency services. He was treated for his injuries at the scene by ambulance officers.

Police established a crime scene and commenced a search of the area. 

Police will seize CCTV from the taxi as part of their investigation. 

Anyone with information about the incident is urged to contact police immediately through Crime Stoppers on 1800 333 000 or use the Crime Stoppers online reporting page: https://nsw.crimestoppers.com.au.