The fire broke out on the ship KM Barcelona on Sunday, about an hour from the resort town of Likupang in the northern parts of the province of Sulawesi. Many passengers jumped into the water in connection with the incident.
Local fishermen have assisted the coast guard and sea rescue in the rescue effort.
Previously, it was reported that five people had died, but the figure was changed after two people who were reported dead turned up at the hospital.
The ship has a capacity to carry 600 people on board.
