The government will take money from people "in need" by introducing means-testing for some patients 12 months after diagnosis, he told MPs.
But Prime Minister David Cameron disputed the figures.
He dismissed Mr Miliband's comments as a "smokescreen" for Labour's reluctance to back reform of the welfare system.
The row over proposed changes to the benefits system stems from the government's current reassessment of all those on incapacity benefit to see if they are able to work.
'Amazed'Cancer charities argue that changes outlined in the government's Welfare Reform Bill - which is being debated in detail by MPs on Wednesday - would see some people being made worse off a year after being diagnosed with cancer.
Rather than receiving employment support allowance - the successor to incapacity benefit - as they do now, people recovering from a serious illness who are reclassified following a fitness-to-work test will see their benefits means-tested after 12 months.
Continue reading the main story Ben Wright Political correspondent, BBC NewsNo more Nasal Ed. Today saw the hatching of Angry Ed.
He shouts, he growls, he bangs his fist and jabs his finger.
When Miliband stood up, the Lib Dem and Tory benches erupted in cheers for Labour's leader.
They think he's a loser who'll help them win.
Certainly Ed Miliband's questioning of David Cameron last week fizzled out like many before.
The Labour leader has tended to skip between subjects each session and leave himself open to swift counterattack by Mr Cameron who tends to swat his opponent away.
Not today.
Ed Miliband drilled down into a technical but emotive welfare issue that the prime minister was clearly not expecting.
As if galvanised by the nameless critics muttering about his problems in the papers, Miliband grilled Mr Cameron with anger, focus and passion.
The arguments about the policy will go on through the day.
But when he sat down it was Mr Miliband's team who were cheering for the first time in weeks.
Today at least, he silenced his critics.
If their family income is more than ?150 a week, the charities say these people could lose ?94 a week in contributory allowance.During a heated prime minister's questions session, Mr Miliband told MPs: "These are people who have worked hard all their lives, done the right thing, who have paid their taxes and when they are in need, the prime minister is taking money away from them.
"Britain's cancer charities have been making these arguments for months. I am amazed the prime minister does not know about these arguments. How can it be right that people with cancer, 7,000 people with cancer, are losing ?94 a week?"
But Mr Cameron said the same benefits would be available for the first 12 months, as under the last government and, for the most vulnerable, support could continue indefinitely.
"It is the same test as under the Labour government and it is put in place fairly," he said.
"The whole point about our benefit reforms is that there are proper medical tests so we support those who cannot work, as a generous and tolerant and compassionate country should, but we make sure that those who can work have to go out to work so that we don't reward bad behaviour."
The prime minister accused his counterpart of using the issue as a "smokescreen" to hide the fact his party was "divided" over welfare reforms - a claim that drew an angry response from the Labour leader who said the claim was a "disgrace".
'Pragmatic'Labour MPs also called on Mr Cameron to apologise for his "smokescreen" comment.
Asked about the 7,000 figure, employment minister Chris Grayling said it was "pure guesswork".
But he told the BBC that the government was having to make "difficult" decision on welfare due to the size of the deficit it had inherited.
"We can't afford to continue to provide, in difficult times financially, support for people through the welfare state who have got other financial means to depend on. That is one of the pragmatic realities of life today."
Macmillan Cancer Support, which has lead the campaign against the changes, said the government's position was "hard to understand" and it would take about ?34m a year to change it and restore the assistance.
The charity said those affected were not the most seriously ill, who would continue to receive indefinite support, but those who were on the road to recovery and who were expected to take steps to prepare themselves for a return to work - such as preparing a CV.
"We're very hopeful that the government will look at this again, that they can't possibly be trying to penalise cancer patients, right at the point when they're trying to return to work," the charity's Mike Hobday, a former Labour candidate, said.
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