A man stabbed his two young sons and dragged them into a lake, leaving one dead, hours after taking them from his father-in-law's house at knifepoint, police say.

Police with search dogs were combing Dean's Lake for Katron Walker on Tuesday night when he ran out of an abandoned trailer and into the murky water, dragging his naked children with him, authorities said. Officers rescued 2-year-old Monte Walker; divers later found the body of his 4-year-old brother, Collin.

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Anita Joy Smothers, who lives nearby, said she went into the water in an attempt to help the children and demanded to know where Walker had dropped Collin. "He's grinning and he goes, 'He's probably at the bottom of the lake by now,'" she said.

Police said Walker, 32, had self-inflicted stab wounds in his chest and marijuana and methamphetamine in his system. He and his younger son were hospitalized and expected to survive.

Walker faces charges of murder and attempted murder.

Despite the knifepoint abduction, it took seven hours for authorities to issue an Amber Alert. The process was slowed because Indiana does not normally issue Amber Alerts in child custody cases, police said.

Bill Bergherm, Terre Haute assistant chief of detectives, said there was not "a lot of delay" in issuing the alert. Police first had to determine whether they had enough information to issue it, he said.

Walker's wife, Theresa, had told him on Sunday she wanted a divorce and moved into a shelter with her sons, authorities said. She filed an order of protection against him Tuesday morning, saying she had received a threatening call from him, police said.

Later that day, Smothers said, she saw the boys and their father at the lake, where they had been fishing and eating hot dogs. "All day I heard them say, 'I love you, Dad,'" Smothers said.

Smothers' family called police later after seeing the Amber Alert on TV.

Authorities surrounded the lake, and Walker jumped into the water with his children, police said. Monte had neck and puncture wounds in his chest; Collin was found in 12 feet of water with his throat slashed and his chest marked with puncture wounds. The coroner said it appeared Collin had been stabbed to death.

Blood and a steak knife were found in the trailer Walker fled, investigators said.

Vigo County court records show Walker was convicted of methamphetamine possession in 2003 and placed on probation.

The Amber Alert system, created in 1996 in response to the kidnapping and death of a 9-year-old Texas girl, is designed to notify communities of children's abductions. Each state has its own rules for issuing alerts.