The Mosgiel man received serious leg and chest injuries when he stepped off the ledge about 11.30am and landed on rocks below, near the University of Otago clock tower building.
He was in a stable condition last night.
Jacob Hall (13) was fishing on the banks of the Leith when the incident happened.
Jacob said the man then walked further along the bank before stopping to ask another man for directions to a camping ground.
"He carried on walking along the bank, and then he just walked straight off the side. I was shocked."
Police and fire appliances attended the accident.
The man was lifted up the bank to his companion (a golden labrador) and a waiting ambulance.
Senior Constable Darryn Buist, of North Dunedin Police, said the dog may have been distracted or spooked, and led his owner too close to the edge.
"It's quite unusual for a seeing-eye dog to do that."
The dog was taken by the SPCA to dog training staff at the Royal New Zealand Foundation of the Blind.
RNZFB Guide Dog Services national manager Paul Metcalf said the dog would be checked and cared for until his owner was able to look after him again.
Mr Metcalf said the incident would be investigated and if there was any cause for concern about the dog's actions, he would be given additional training.
He acknowledged the incident was unusual and said guide dogs were trained to avoid potentially dangerous environments for their owners.
