Residents were urged to avoid the area after two women were knifed.
Police were called to Atherton Road in Hindley at around 10.30am yesterday (Saturday, December 14) and shut the street in both directions, between the junctions of Leigh Road and Westleigh Lane.
Two medical helicopters, two ambulances, two rapid response cars, and two advanced paramedics were also called out.
Greater Manchester Police later confirmed one of the women, 39, was "receiving treatment in hospital for serious injuries".
Despite initially saying the other woman, 28, was also badly hurt, the force later said she only suffered "minor" injuries and was already out of hospital.
A statement said the stabbing was not an act of terrorism, with the 28-year-old arrested on suspicion of attempted murder.
A crime scene investigation van was parked just outside the cordoned off area, while forensics experts dressed in white overalls were seen walking towards where the stabbing happened.
One Atherton Road resident said: "My daughter saw some of what happened when she was driving in her car.
"She said a young woman ran from behind the community centre. She was bare-footed and covered in blood.
"She had a knife stuck in her neck and then collapsed. Lots of people were stopping to help her."
James Palmer, 32, also of Atherton Road, added: "It's a sleepy village and a massive shock what has happened."
Det Insp Nathan Percival from Wigan CID said: “This was a violent incident which has left a woman in hospital with serious injuries.
“Investigative and forensic work is still being conducted at an address on Atherton Road. There were a number of road closures in place, but they have since been lifted.
“Our enquiries are still ongoing and I would encourage anyone who has any information that may assist with our enquiries to get in touch with us."