The 36-year-old victim died from his injuries at the scene in Trafford.
Police were alerted of a disturbance just before midnight on Thursday on Moss Lane in Partington, a town in Greater Manchester.
The victim was chased down the road by someone holding an axe, who then launched a deadly attack on him, according to police, Presstv Reported.
The assailant reported the attack before fleeing the scene.
A 31-year-old man has been arrested on suspicion of murder and remained in custody for questioning on Friday, police said.
Detective Chief Inspector Jonathan Kelly, from Greater Manchester Police’s Trafford district, said, “I would like to reassure the public that this is being treated as an isolated incident.”
He said the force has implemented an increased police presence in the Partington area while their investigation is ongoing.
“This is a shocking incident in which a man has sadly lost his life.”
He said, “Our thoughts remain with his family, who are being supported by specialist officers at this incredibly distressing time.”
Greater Manchester Police said the offender “caused significant damage to a number of unoccupied, stationary cars” before launching his attack on the victim, who has not yet been publicly identified.
DCI Kelly said, “Whilst we have a man in custody, our investigation is very much ongoing.”
He urged anyone with any information to get in touch with police.