Around 12:23 a.m., officers were flagged down by someone who reported a man with a knife along State Street, according to the Santa Barbara Police Department.
That's where they found a victim lying on the ground with a stab wound. Two other stabbing victims were found nearby, police said.
All three victims were taken to the hospital.
Police did not release information on their conditions, or say whether the suspect was in custody.
The incident happened in the same area where the community is set to celebrate its annual Old Spanish Days Fiesta this weekend.
A scheduled parade is still expected to take place Friday.