Chancellor Angela Merkel was "horrified by the knife attack", her spokesman Steffen Seibert wrote on Twitter.
Andreas Hollstein, 57, the mayor of the western town of Altena, was attacked Monday evening at a local kebab restaurant by a man who had loudly criticised his liberal refugee policy.
The 56-year-old attacker, who appeared to be under the influence of alcohol, used a 30-centimetre (one foot) long knife, reported Spiegel Online.
He was arrested at the scene.
The town of about 17,000 people was well known for taking in a larger share of asylum seekers than required amid the mass influx that has brought more than one million migrants and refugees to Germany since 2015.
The state premier of North Rhine-Westphalia, Armin Laschet, said security services assumed the attack was "politically motivated".
Hollstein was taken to a local hospital and, after treatment, released hours later.
He thanked a restaurant employee who rushed to his help and who was also injured.
"I had some hands-on people at my side and I'm glad that I'm still alive," Hollstein told a local news website.
Local media reported the attacker had asked Hollstein "are you the mayor?" before slashing him.
Justice Minister Heiko Maas tweeted that "we must never accept that people are attacked because they help others," adding that there was no space "for hate and violence" in Germany.
The assault evoked a knife attack on Cologne's mayor Henriette Reker in October 2015 by a right-wing extremist who was angered at her welcoming stance toward refugees.
