Almost 80 were quickly recaptured after the incident, which occurred when prison guards allowed inmates to take part in Friday prayers in the Muslim-majority nation.
But the inmates instead headed to the main door of the jail in Pekanbaru city, on Sumatra island, and tried to break through it.
When that failed, they fled through a side entrance and broke through a wire fence at the jail, which was guarded by only a handful of officers, Indonesia's director general of prisons, I Wayan Dusak, told AFP.
"About 200 escaped, but at least 77 people have been recaptured," local police spokesman Guntur Aryo Tejo told AFP.
Police have put road blocks in the city and launched a massive hunt for the inmates still on the loose.
Dusak said the trigger was discontent over the head guard, whom prisoners want replaced.
The male-only prison has a capacity of 300 people but was holding 1,870 inmates, with only five guards and a porter on duty at any one time, Dusak said.
An additional 400 police and military personnel have been deployed to guard the prison, Tejo said.
Jailbreaks are common in Indonesia, where inmates are held in often unsanitary conditions at overcrowded prisons.
There was a spate of breakouts in 2013, including one where about 150 prisoners -- including terror convicts -- escaped from a jail on western Sumatra island.
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