Grealish was in the Birmingham penalty area in the 10th minute when a man ran on to the field and threw a punch from behind at the Villa captain.
The blow caught Grealish on the side of the head and sent him sprawling to the turf.
The intruder was quickly restrained by a steward as Villa players including Tammy Abraham and Glenn Whelan rushed to Grealish's defence.
After the fan had been shoved over, he was eventually led away by police, defiantly blowing kisses to the crowd.
A visibly furious Grealish was helped to his feet and was able to continue playing once order was restored at Birmingham's St Andrew's stadium.
Grealish produced the perfect response to the assault in the 70th minute.
Taking possession 20 yards from goal, he advanced into the Birmingham penalty area before drilling a low shot into the far corner to seal Villa's league double over their hated neighbours.
In a fittingly dramatic gesture, Grealish jumped into the stand to celebrate with the Villa fans behind the goal and was booked as a result.
West Midlands Police confirmed the Birmingham supporter had been arrested, while the Blues condemned the attack as "deplorable and disgusting" and will apologise to Grealish personally.
It was reported Birmingham will ban the man for life from St Andrew's.
"The EFL condemns the mindless actions of the individual who encroached on to the pitch at St Andrews on Sunday afternoon," a Football League statement read.
"It's a situation no player should ever be faced with."
Former Manchester United defender Gary Neville said: "The club are going have to take a huge punishment for this to act as a deterrent in the future. A Points deduction or Empty stadium for 10 games!"
Former Villa midfielder Lee Hendrie, working as a TV pundit at the match, added: "A fan running on to the pitch and taking someone like Jack out, there's knife crime... anything could have happened out there."
There is a long history of animosity between Birmingham and Villa supporters, with outbreaks of serious violence in the streets marring many of the 'second city' derby encounters.
There was fighting between rival gangs before Sunday's match, with police having to hold back fans while at least one man was seen being treated by paramedics after suffering a head wound.
Worrying trend
Fanning the flames further, Grealish is a boyhood Villa fan and once turned down a chance to join Birmingham on loan when he was a youngster, reportedly saying: "I'm not going there".
In 2002, a Birmingham fan was jailed for four months after running onto the pitch at St Andrew's to taunt then Villa goalkeeper Peter Enckelman, who had just conceded a bizarre own goal when he let a backpass roll under his foot into the net.
The supporter made an obscene gesture in Enckelman's face and slapped his cheek.
Adding to the tense nature of Sunday's derby, both teams are fighting to earn a place in the Championship play-offs, with Villa's win taking them one point above Birmingham.
The attack on Grealish continued a worrying trend of supporters targeting players this season.
On Friday, Rangers captain James Tavernier was confronted by a Hibernian fan who had jumped out of the home stands at Easter Road.
The supporter kicked the ball away from Tavernier before the pair engaged in a bout of shoving.
Police later confirmed a 21-year-old man had been arrested.
That incident came six days after a glass bottle was thrown from the same section of Hibernian's stadium as Celtic's Scott Sinclair prepared to take a corner.
In December, Manchester City's Raheem Sterling was subjected to alleged racist abuse from Chelsea supporters at Stamford Bridge.