Rescue teams have found nine bodies, including those of two children, and rescued 232 survivors from the Dumai Express 10, said Nurdin Basirun, a local government official.
High waves were making the search and rescue operation difficult, said Brig. Gen. Puji Hartanto, police chief of Riau Kepulauan province. At least nine ships and several fishing boats were searching the choppy sea for an unknown number of missing passengers.
Police and navy officials said the ferry manifest listed 228 people, including 15 children, and 14 crew members. But there were differing reports about whether those numbers were accurate or if more people were on board the ship.
The ferry left on an inter-island voyage Sunday morning and reportedly sank in poor weather 90 minutes into the trip from Batam to Dumai in Riau, a province off Sumatra island in western Indonesia. The area is about 600 miles (900 kilometers) northwest of Jakarta.
The ship sank about 30 minutes after huge waves hit its bow and water started seeping in, according to a report from the ship's captain, said Lt. Col. Edwin, the local navy chief.
Passing boats have picked up dozens of those rescued and took them to nearby islands for medical treatment.
In a separate accident Sunday, the Dumai Express 15 with 278 people on board ran aground on its way from Batam to Moro island in Sumatra. No one was hurt said local police chief Yasin Kosasih.
Indonesian ferry accidents have killed hundreds of people in recent years. Boats are often overcrowded and safety regulations are poorly enforced. The vast country spans more than 17,000 islands, and boats are a popular and relatively cheap form of transportation.
In January, some 230 people went missing after their ferry capsized in a cyclone off the coast of western Sulawesi. In December 2006, a crowded ferry broke apart and sank in the Java Sea during a violent storm, killing more than 400 people.