Two Muslim women have been left shaken after they were verbally attacked about their religion while driving through Newcastle.

A 26-year-old woman was driving with her mother in the front passenger seat when they stopped in traffic on Smith Street about 7:00pm (AEST) on Monday.

A 27-year-old man approached them on foot and started abusing and threatening them, police said.

"He's made derogatory statements about their religion," Chief Inspector Dean Olsen said.

"He struck the side view mirror and then continued with a verbal tirade."

The women drove off but pulled over a short distance away to fix the car's mirror.

The man followed them and continued the abuse.

"It was at this time that several members of the public got involved and tried to stop this man doing what he's doing," Chief Inspector Olsen said.

"He's turned on them and made a few threats and assaulted at least one of those people."

A man who went to the aid of the women was punched, but not badly hurt.

Chief Inspector Olsen said the man stole mobile phones from two of the people who intervened before running off.

"He was apprehended by the members of the public and they retrieved their property, but he fled the scene again," he said.

"A short time later police arrived and effected the arrest."

The man has been charged with two counts of intimidation, two counts of larceny, one count of assault and one count of malicious damage.

He spent the night in police custody and will face Newcastle Local Court today.

Chief Inspector Olsen said the woman and her mother have been left shaken by the attack.

"The two ladies in the car were quite shaken by what occurred but they did not come to any physical harm," he said.

He has praised the actions of the witnesses who intervened.

"Certainly from a policing perspective I’m quite comforted by the fact that our society is such a good one that people will intervene and stop people from being interfered with in this way," he said.