It happened around 4 p.m. on the unit block of W. Tulpehocken Street.
Police say the school bus, with seven students from DePaul Catholic School on board, collided with the driver of a 2004 Jetta.
The driver of the Jetta fled on foot. He remains at large at this time.
The students sustained minor injuries and have been released to their parents.
The cause of the crash remains under investigation.
Anyone with any information is asked to call police at 215-686-TIPS.