At the fenced play area your dog moves around other dogs easily. On the pavement, one dog approaches and yours pulls, barks, and twists at the end of the lead. The contrast is confusing, but the situations are not the same. On lead, your dog cannot choose their distance, circle away, or greet at their own pace. They may be worried, frustrated, excited, or some mix of those things.
Don't use off-lead friendliness as proof that a close on-lead greeting is safe. For now, skip nose-to-nose meetings on narrow paths. Cross early, turn down a side street, or put space between the dogs. A loose lead where safe gives your dog room to move without feeling constant pressure, it is not a reason to let them reach another dog.
Change what the passing dog predicts
Find a wide area where another dog can pass at a distance that lets yours notice, take food, and move normally. Offer treats while the other dog is in view, then walk away. If your dog stares hard, stiffens, refuses food, or barks, you are too close for that exercise. Next time, begin farther away. Practice a U-turn separately so leaving is easy when a dog appears unexpectedly.
Don't insist on a sit while another dog heads directly toward yours. Moving away is often the kinder, safer option. Nor should you test a theory by unclipping the lead in an unsecured place. Whether your dog wants to say hello or wants distance, both need a controlled setup.
If lunging risks a bite or you cannot safely hold the lead, ask a qualified, reward-based behavior professional for help. A sudden change warrants a veterinary check too. The goal may simply be a walk where your dog can see another dog and keep going with you. The leash-reactivity guide goes deeper on why the leash changes the picture and how to practice safely
Sources: Cornell University College of Veterinary Medicine: Managing reactive behavior. Dogs Trust: Reactive dogs - why it happens and how to help.