According to officials, two men from Afghanistan were sledging in the Ore Mountains in Altenberg on Sunday when a man walked towards them.
"A young man approached them on the slope, wearing a steel helmet emblazoned with a swastika," a police spokesperson said.
"The stranger purposefully walked up to two men from Afghanistan and insulted them.
"Shortly afterwards, he hit the younger man in the head using his helmet, causing him to fall to the ground."
Witnesses said that the man stopped when passers-by intervened, however he performed a Nazi salute before leaving.
Along with being sought after for an aggravated assault charge, the attacker is also wanted for questioning over the "use of symbols of unconstitutional organizations" which prevents anyone in Germany from displaying any symbols previously used by the Nazi party.
Europe's refugee crisis, which saw more than one million people — mainly from the Middle East and North Africa — enter Germany in 2015, has reignited the country's immigration debate and raised concerns about the rise of Islamaphobic or Neo-Nazi groups.
Concerns over attacks on refugees were heightened after police said close to 1,000 drunken men of mostly "Arab of North African origin" were responsible for sexually assaulting and robbing hundreds of women during New Year's Eve celebrations in Cologne.