Eyewitnesses say he was struck many times by an attacker wearing a mask.
Police said he appeared to have been stabbed in the neck.
Rushdie was treated on stage at the Chautauqua Institution, an arts and education centre, then taken to hospital by helicopter. According to his literary agent, he was taken into surgery.
A suspect was arrested at the scene and is in custody, New York State Police say.
Rushdie faced death threats and went into hiding for nearly a decade after his book The Satanic Verses was published in 1988.
The attack has been widely condemned.