Twenty-five people were plucked to safety but about 75 were unaccounted for after the boat carrying people from Lebanon, Jordan and Yemen went down off the main Indonesian island of Java, police said.
It came just days before new Australian Prime Minister Tony Abbott visits Indonesia for talks likely to focus on his tough policies aimed at stemming the flow of asylum-seekers.
Warsono, a police official in Cianjur district on Java, said the bodies were discovered floating in an estuary on today morning.
"Local people said their boat had broken into several pieces," said the official, who like many Indonesians goes by one name, although he did not know when the accident happened.
A spokesman for the Indonesian search and rescue agency said that four of its boats, along with fishing boats, had earlier been searching for the missing.
The search had been called off when it got dark and would resume again tomorrow, he said.
Warsono said that the boat was believed to have been carrying 120 people when it went down and had been heading for the Australian territory of Christmas Island.
Hundreds of asylum-seekers from around the world have died in recent years trying to make the treacherous sea crossing from Indonesia to Australia on rickety, wooden boats.
They normally pay people-smugglers huge sums to make the crossings, and almost always head for Christmas Island, which is far closer to Indonesia than it is to the Australian mainland.
Boatpeople were a key battleground in the Australian elections earlier this month due to growing public anger as thousands continue to arrive after making the hazardous sea crossing from Indonesia.
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