Driver Malik Rizwan honked at fellow cabbie Zbigniew Sobczak after Sobszak cut him off, prompting Sobszak to jump out of his cab and use a vulgarity repeatedly.
Rizwan called the police and accused Sobczak of assault.
A city administrative law judge found Sobczak guilty of verbal harassment, not assault, and recommended a $350 fine.
But Taxi and Limousine Commission Chairman Matthew Daus, in a ruling last Friday, increased the penalty to $1,000 and a 30-day suspension.
There was a time when cab drivers were given more leeway with language.
A 1982 legal decision in a case called TLC vs. Baudin found that a "driver's use of profanity during a fight with a pedestrian was not misconduct given cognizance to the realities of life in New York City."
But Daus, in a letter to Sobczak, said, "To the extent that decisions issued before my tenure, such as TLC vs. Baudin, may be read to overrule the penalty of license revocation for verbal harassment or abuse, I would override those decisions."
Sobczak's lawyer, Cynthia Fischer, told the New York Post that Daus' decision was unduly harsh.
"You're asking cabbies to be inhuman and not react to ... things any one of us would react to," she said.
Fischer did not immediately return a call seeking comment Wednesday.
