The accident occurred near the holiday island of Langkawi in northwestern Malaysia, close to the border with Thailand.
A search and rescue operation is underway and so far 13 people have been rescued.
In addition to the sunken boat, two other boats are missing, Malaysian police say. A total of at least 300 people are believed to have been on the three boats, which all set sail from Myanmar.
Malaysia is home to millions of migrants from poorer parts of Asia, many of them unregistered, who work in sectors such as agriculture and construction.
The boat crossings are dangerous and several deaths have previously occurred in connection with migrant boats capsizing.
