Authorities have released a sketch of the suspect.
Police say the boy was walking home from school in Beachwood, Ocean County, when the man drove up beside him near Cable Avenue.
The boy told police the man got out of his car, a black Audi, and grabbed his arm.
The boy ran away and called police.
"We're taking this very seriously," police sergeant Frank Melillo said. "We don't feel it's a hoax. It is an ongoing investigation."
The man was described as white, bald and about 6-feet tall. He was wearing a black leather jacket and white T-shirt, Melillo said.
Anyone with information about the incident is asked to call police at 732-286-6000, ext. 191.