The resident, who does not wish to be named, was alerted to three men targeting his motor while it was parked outside his home in Highgate Drive on Tuesday afternoon.
One of the thugs was armed with a baseball bat while another had a cordless drill but neighbours were alerted to the terrifying incident and rushed out to help chase the trio away before any violence broke out.
Paddock ward Councillor Waheed Rasab urged residents to be aware of the gang, who are believed to have targeted cars across the borough.
West Midlands Police confirmed there has been a spate of incidents in Walsall recently but said it was a nation-wide issue.
Depending on the make and model of cars, catalytic converters can cost up to £900 to have installed and it is thought thieves are looking to make quick, easy money by selling them cheaply or for scrap.
The offenders were in a grey Honda Accord but it is believed they were using fake number plates.
The resident who confronted them said: “It’s unbelievable that they did this in broad daylight outside my home.
“When I approached them, one of them had a cordless drill while another had a baseball bat and they were saying they were going to attack me.
“So I shouted to neighbours and then they got scared and run off – one of them took the rear number plate off before they drove away. It is dangerous for the community. I want to warn people to take care.
“Apparently, it has been happening all over Walsall in places like Alumwell, Birchills and Chuckery. I was told they have even taken catalytic converters from cars parked at Manor Hospital.
“They seem to hang around the area for a few minutes to assess it and then they try to steal them.”
Councillor Rasab added: “This vehicle has been driving around Walsall raiding vehicles and these people are extremely dangerous.
“They could have attacked this resident had they not been scared off so I want to raise awareness of this and urge people to contact West Midlands Police if they witness anything."
Councillor Rasab said he has raised the issue with police chiefs.
A West Midlands Police spokesman said: "We’ve seen a recent spate of catalytic converter thefts in Walsall.
"Most cars have catalytic converters, which are stolen for the value of the metal or are illegally re-sold.
"The simplest way to prevent catalytic converter theft is to park in a garage if you have one or park in a well-lit busy area.".