Edward Thomas, 29, was arrested for his alleged role in the assault.
It happened in broad daylight over the weekend in front of a crowd of people.
Investigators said the woman reported the assault while receiving hospital treatment Friday night. She told officers the attack happened earlier Friday after she was involved in a minor traffic accident near an apartment complex in the southern part of Dallas, according to the police statement released Saturday.
A purported video of the attack posted on Facebook shows a man in a white shirt viciously beating the woman, apparently into unconsciousness, while the crowd looks on and homophobic slurs are shouted.
Several women eventually carried the victim's limp body to safety.
A Dallas police spokesman said the woman's identity would not be released Sunday.
Dallas Mayor Mike Rawlings said he is "extremely angry about what appears to be mob violence against this woman" and that those responsible do not represent how most residents feel about the city's "thriving LGBTQ community."
"I am in contact with (Police Chief U. Renee Hall) and she assured me that the Dallas Police Department is fully investigating, including the possibility that this was a hate crime," Rawlings, who has viewed the video, said in a statement Saturday.
Last November, the FBI reported that 7,175 hate crimes were committed in the United States in 2017, the most recent year for which the agency had compiled data. Of those, 1,130 were based on sexual orientation bias and 119 on gender identity bias. The data showed a 5% increase in hate crimes motivated by sexual orientation bias and a 4% percent decrease in hate crimes motivated by gender identity bias. Of crimes motivated by gender identity bias, 106 targeted transgender people, a 1% increase from 2016.
The Associated Press contributed to this report.