The utility forward was stretchered from the field in a neck brace just seconds from halftime after landing on his head in a tackle by Storm forwards Jesse Bromwich, his brother Kenny and Jordan McLean.
The tackle was put on report by referee Gerard Sutton while McKinnon was taken to hospital.
The Knights, who ousted Melbourne from the NRL finals race at the same venue last season, started on the wrong foot with three successive penalties.
The Storm opted to take two points from the third through Smith but the visitors made them pay soon after when a Michael Dobson grubber kick hit the upright and was scooped up by Jeremy Smith.
Melbourne lifted a gear and with winger Sisa Waqa, forward Kevin Proctor and centre Will Chambers chiming in with tries, they had all the momentum.
But Kurt Gidley added a second successful penalty kick following the McKinnon incident which kept his team in the hunt.
Victorian-raised winger Young Tonumaipea scored his first NRL try in the 44th minute and it looked like Melbourne would run away with it until Uate got into the action.
Newcastle continued to look dangerous with the ball but couldn't find the extra points they needed and remain winless for the season.
Knights coach Wayne Bennett said he hadn't received any update on McKinnon's condition.
He said while the players did well to put it out of their minds for the second half, it was the first question many asked as they entered the change-room post game.
Bennett said his players "beat themselves'' and needed to play smarter.
"The penalties are just ridiculous,'' Bennett said.
"Fifteen penalties, multiple repeat sets on their tryline.
"They defended great but at the end of the day it's a quality footy team they're playing and we're not going to hold them out long enough.
"It was just too much to absorb in the end.''
Storm coach Craig Bellamy said his side was slowly putting together an 80 minute performance.
"I thought we were better for longer periods of the game,'' he said.
"We've still got some improvement in us but I thought it was a pretty good effort.''
Bellamy said he didn't get a close look at the McKinnon tackle and was only concerned that the young Knight was OK, rather than any penalties his players may face.
"No-one likes to see anyone get injured and carried off like that so we just hope that Alex is OK,'' he said.
"I don't think there was any malice in it at all but we're more concerned for Alex than what they're going to do with the tackle.''
- AAP
