The incident started outside a Prospect Heights bar during a dispute that began when two dogs' leashes got tangled.
Police said a woman was trying to untangle the leashes when 41-year-old Hai Eun Hillmann, who owned the other dog, put his hand on her arm while offering to handle it.
The Wall Street Journal says the woman's husband apparently took the gesture as an aggressive act. Police say 36-year-old Daniel Pagan fatally stabbed Hillmann as the fight escalated. Hillman, who worked at the bar, was well-known and loved in the neighborhood.
"It's just unfathomable, it really is," a friend of the victim said. "I can't even begin to tell you how hard this is for all of us."
"He was an amazing man," a neighbor said. "He was funny, and fast to help someone out."
Pagan was arrested and charged with murder, as well as assault for allegedly attacking a man that came to the Hillmann's aid.
Police said 38-year-old Daniel Hultquist, a friend of Hillman, was stabbed in the neck.
He is in stable condition at Kings County Hospital.