Police had to use a special full body restraint to subdue the woman before carrying her into an ambulance.
They say she randomly punched one person and then stabbed 39-year-old Heather Burke in the shoulder and chest with a steak knife.
The injured victim stumbled towards Bloomingdale's, which has a subway level entrance.
Department store employees quickly rushed to help.
"We administered first aid. Then some of our loss prevention people went out to the subway, saw that a Good Samaritan had held the woman, so they secured the woman in handcuffs until the police were there to take her," said Anne Keating, Bloomingdale's Senior VP Public Relations.
Charles Williams says he was one of two men who subdued the crazed attacker at the subway station until help came.
"I just grabbed the lady from behind, me and another gentleman, just held her until authorities came," Williams said.
Williams, who works as a street cleaner for East Midtown Partners, says he heard screaming and ran into the station.
"I just did what I had to do. I'm not trying to be a hero. I just saved somebody's life today, and I hope the lady that got stabbed, I hope you're feeling better and I hope you're doing better," Williams said.
The attack happened in a section of the East Side popular to tourists and shoppers.
News of the stabbing spread quickly and made several feel uncomfortable about using this subway stop.
"I went downstairs and said, 'You know what, I'm not taking the subway right now, I'm going to take a cab,'" said Marcella McCarthy, a woman who heard about the attack.
The suspect was taken to Bellevue Hospital for a psychological evaluation.
Charges against the woman are pending.
The victim, Heather Burke, is in serious but stable condition at New York-Presbyterian, Weill Cornell Medical Center.
The second victim, a 19-year old woman, was punched in the face and had her hair pulled.
She refused medical attention.
Late Monday night, Burke posted on her Facebook page saying: "Got stabbed in the subway by a complete stranger in the abdomen and in my arm on my way to work today Had emergency abdominal surgery and am in the hospital for an yet to be determined amount of time what a day!"