The boat, built to carry only 150 passengers against 204 on board, capsized yesterday off the fishing town of Cidaun in western Java due to a leak.
The vessel was believed to be carrying people from Iran, Iraq and Sri Lanka, Australian media reports said.
The sinking comes just days after Prime Minister Kevin Rudd changed Australia's refugee policy so that people who arrive by boat will no longer be allowed to settle there. The change has drawn sharp criticism from human rights groups.
The survivors included a pregnant Sri Lankan woman who was being treated at a health center in the town of Cidaun.
A baby boy aged about 18 months and two girls, aged two and seven years, and a 10-year-old girl were among the dead.
Indonesian rescue officials earlier said they did not know exactly how many were on board the vessel.
Survivors gathered in two villages, Sukapura and Pantai Jayanti, and officials said they would be taken to hospital.
The Australian Maritime Safety Authority said it has offered help to the Indonesian authorities.
The country has experienced a sharp increase in the number of asylum-seekers arriving by boat in recent months. But critics have accused Australia of avoiding responsibility and passing on its problem to a developing nation.
Reacting to the incident, Rudd was quoted as saying in reports, "All of our agencies are actively following this and ensuring that everything that can be done is being done."
He said the tragedy underlined the need for a tough asylum-seeker policy.
"We are seeing too many drownings, we are seeing too many sinkings, too many innocent people being lost at sea.
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