Rina Kawaei, 19, and Anna Iriyama, 18, both suffered broken bones in their right hands and received cuts on their arms and heads from the 50-centimetre saw at the event in Iwate in northern Japan.
Reports said the attack came after a mini-concert yesterday afternoon as fans were lining up to shake hands with performers inside booths.
Kawaei and Iriyama were inside the same booth when a man in the queue suddenly produced a saw, the Yomiuri daily said.
Some of the 100 or so staff and security guards at the event pounced on the attacker and held him until police arrived, reports said. A member of staff was also hurt in the melee.
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Both girls were expected to be discharged from hospital tomorrow, a statement from the band's management said.
A 24-year-old man, identified as unemployed Satoru Umeta, has been arrested on suspicion of attempted murder, police said.
"We have started questioning the suspect this morning to know details, including his motive," a detective with Iwate prefectural police told AFP.
The group - one of the most successful acts of all time in monetary terms - is built on their accessibility to their legion of fans. They appear at regular events all over the country to shake hands and pose for pictures, as well as on social networking sites.
Fans are given around seven seconds to pose with their idols, the Yomiuri reported today, before they are moved off by security heavies eager to prevent problems and maintain the through-flow.