The woman, who is in her late 20s, was bitten on the right leg by a suspected bull shark in Elizabeth Bay around sunset on Monday.
Michael Porter had just arrived home from work when he heard faint yells for help through his open window.
"It was horrifying, I've never experienced anything like it," he told Nine's Today program on Tuesday.
"Lauren, the victim, was trying to pull herself up off the side the harbour pool, trying to get into the safe enclosure.
"Her leg was sort of trailing behind her - behind her was all red blood.
"The whole thing was totally surreal and I still haven't processed it all, to be honest."
He was quickly joined by several other neighbours, including a "hero" vet named Fiona who applied tourniquets to stem the bleeding.
The victim's significant wounds meant "blood was everywhere" and, while in little pain, she struggled to maintain consciousness before paramedics arrived and rushed her to nearby St Vincent's Hospital for surgery.
"Fiona is a hero and I believe she saved her life," Mr Porter said.
"I'm not sure what would have happened but it wouldn't have been good."
Shark attacks in Sydney Harbour are rare but the area is an important habitat for adult and sub-adult bull sharks.
Tagging and tracking in the past 15 years has revealed bull sharks use all areas of the harbour from Parramatta and Lane Cove Rivers to Middle and North Harbour.
They prefer water temperatures above 20C, slightly deeper water during the day and shallower water at night and are more active at dawn and dusk.
People should take extra care in murky, dirty water, after high rainfall or floods, where lots of baitfish and diving birds are around and within one kilometre of a river, the NSW government says.
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