Nieto, who won multiple titles in the 50cc and 125cc categories, struck his head when he was flung from his bike after it was hit from behind on the Santa Gertrudis main road.
Spokespeople from the Nuestra Senora del Rosario hospital were not immediately available to comment but Spanish media reported sources saying Nieto was in a "serious but not critical" condition.
"All our thoughts today are very much with Angel Nieto, following his quad biking incident in Ibiza," said MotoGP on their official twitter account.
Nieto, whose sons Pablo and Angel Jr were also racers, won 13 world titles in a career lasting from 1964 to 1986, but for superstitious reasons refers to his total as '12 plus one'.
His career total of 90 wins puts him third in the all-time rankings behind Giacomo Agostini and Valentino Rossi.
(Reporting by Rik Sharma; Editing by Julian Shea)
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