Officers responded to a report of a stabbing at Embarcadero and Folsom Street at about 1:45 a.m., police spokesman Officer Gordon Shyy said.
Arriving officers found a man in his 20s who had been stabbed several times in the torso, Shyy said.
The victim was taken to San Francisco General Hospital with potentially life threatening injuries, Shyy said.
According to preliminary information, a man in his 50s stabbed the victim during a verbal altercation, Shyy said.
The suspect was arrested after he was found hiding near the crime scene, according to police.
The stabbing remains under investigation.