"He did not stab her," said Officer Jacinto Rivera, a department spokesman.
Police did not release the identity of the woman, who told officers she was Knight's girlfriend of three years.The woman was treated at a hospital for minor injuries, according to Rivera.
Knight was taken into custody without incident and booked into the Clark County jail on felony charges of assault with a deadly weapon and possession of a controlled substance, and misdemeanor charges of possession of dangerous drugs without a prescription and domestic violence.
Knight had the drugs Ecstasy and hydrocodone when he was arrested, police said.
Lawyers David Chesnoff and Richard Schonfeld, who are representing Knight, said they wanted to gather information about the arrest and talk with Knight before commenting.
Rivera said Knight would be held at the jail for at least 12 hours on the domestic violence charge.
It was not immediately clear if Knight would appear in person when a judge was scheduled to review his arrest Thursday morning.
Police said Knight and the woman argued in the car while Knight was driving before he allegedly punched her in the head.
"The victim purposely grabbed the steering wheel and caused the vehicle to hit the curb," police said in a statement. Police said the woman tried to run away, but Knight caught her.
Knight has a history of legal problems and was with Tupac Shakur when the rapper was gunned down in Las Vegas in 1996.
Knight was convicted of assault in 1992 and placed on probation, then jailed for five years in 1996 for violating that probation.
He was returned to jail in 2003 for again violating parole for punching a parking attendant at a Hollywood nightclub. He was released the next year.
Knight was wounded during a shooting at a party in a Miami nightclub in August 2005.
His former record company was auctioned in June for $24 million to New York-based Global Music Group Inc.
Daniel McCarthy, a lawyer handling a Chapter 11 bankruptcy protection filing for Knight and the record company, said Wednesday that the sale is pending.
Death Row Records was known for releasing seminal gangster rap albums by Tupac Shakur, Dr. Dre and Snoop Dogg, and sold tens of millions of albums in the heyday of early 1990s rap.
In 2006, a federal judge ordered a bankruptcy trustee takeover of Death Row Records, saying the label had undergone gross mismanagement. Knight's decision to file for bankruptcy protection staved off a move by the court to appoint someone to take control of the record label and his assets.
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