MORE THAN 200 people have been rescued after the ferry they were travelling in sank off the coast of Papua New Guinea (PNG) overnight.

Australian and PNG rescue teams continue in their attempts to pluck the remaining survivors from the water. It is still unclear what the death toll from the disaster could reach.

There were about 350 people on board the Star Ships boat which was making a journey between the towns of Kimbe and Lae , according to BBC News.

The MV Rabaul Queen sent out a distress signal in the early hours of Thursday.

The Australian Maritime Saftey Authority (AMSA) has confirmed that the vessel sank about 16km off Finschhafen. It also told Australian news reporters that there were 219 survivors on board their five rescue ships.

Eight ships and three helicopters are currently at the scene to take part in the search for survivors.

The cause of the accident is not known but bad weather or overcrowding have been cited by the PNG National Disater Centre as possible reasons.

-Additional reporting by AP