Two men wearing balaclavas broke into the house at Figtree in the early hours of Tuesday and cut the 36-year-old's back with the machete.

The man fled through a neighbour's front glass door and suffered more cuts to his hands, arms and legs.

He was taken to Wollongong Hospital for multiple lacerations and a punctured lung. His injuries are not considered life-threatening.

Police are now on the hunt for his attackers, who they believe knew the victim.

The men were last seen running north along the Princes Highway.

"They meant business going there that's for sure," Detective Inspector Brad Ainsworth said told reporters in Wollongong on Tuesday.

"We believe from our investigations thus far it was a targeted attack and the victim and offenders have knowledge of one another."

Insp Ainsworth "wouldn't discount anything" in terms of reasons for the attack, including drug connections.

Police have yet to recover the weapons used.