Nine people were confirmed dead, but with every hour that passed fears mounted for the 287 still unaccounted for after the multi-storey vessel with 475 on board suddenly listed, capsized and then sank 20 kilometres offshore.
Naval and coastguard vessels used floodlights and flares to keep the search operation going through the night, but strong currents and low visibility hampered diving teams' efforts to access the vessel in the hope of finding survivors trapped in air pockets.
"Honestly, I think the chances of finding anyone alive are close to zero," a coastguard official told an AFP journalist on one of the boats at the capsize site.
The coastguard said 179 people had been rescued, a figure little changed from the previous evening.
The tragedy has stunned a country whose rapid modernisation was thought to have consigned such large-scale accidents to the past.
If the missing are confirmed dead it would become one of South Korea's worst peacetime disasters -- all the more traumatic for the number of children involved.
A total of 375 high school students were on board, travelling with their teachers to the popular island resort of Jeju.
President Park Geun-Hye voiced shock and pain at the "tragic" accident.
"Please do not give up until the very last moment," she said during a visit to the national disaster agency's situation room in Seoul yesterday.
It was still unclear what caused the 6,825-tonne Sewol to sink.
Numerous passengers spoke of a loud thud and the vessel coming to an abrupt, shuddering halt -- suggesting it had run aground or hit a submerged object.
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