Dozens of people have been rescued after a ferry capsized in the strait between the Indonesian islands of Bali and Java.

TV footage showed passengers standing on the side of the stricken boat, then jumping into the sea as it sank in placid waters.

Officials said 71 people had been rescued and at least four were still missing from the ferry which was travelling from Gilimanuk port in Bali to Banyuwangi on Java.

Didi Hamzar, head of Bali's Search and Rescue Agency, said the ship's manifest listed 51 people on board including 14 crewmen, but passenger boats are frequently overloaded beyond their manifests in Indonesia.

Video broadcast by TVOne showed other ships in the background as the ferry, Rafelia 2, sank in the narrow Bali Strait. It languished on its side before capsizing.

The cause of the accident is under investigation.

Local navy chief Lieutenant Colonel Wahyu Endriawan said 71 people were rescued.

"We cannot yet know whether some were trapped inside the ship which has totally submerged," he told MetroTV.

Disaster Mitigation Agency spokesman Sutopo Purwo Nugroho also said 71 people were rescued while four others - the captain, a deck officer, and a woman and child - were still missing.

Boats are a popular and relatively cheap form of transport in the world's largest archipelago nation, which spans more than 17,000 islands with a population of 256 million. Sea accidents are common, with safety regulations often poorly enforced.