SYDNEY — Dozens of asylum seekers, including children, were feared dead after a boat sank in violent seas off Australia's Christmas Island, in what witnesses described as a "major tragedy".

Witness Phillip Stewart said on Wednesday he saw people drowning and others smashed against floating debris after their boat broke up against the limestone cliffs of the remote island off western Australia.

"The tragedy continued for some time and we witnessed people actually drowning.... Unfortunately (they) were hit against the rocks," he told Sky News.

Australian police confirmed that a suspected asylum seeker boat had been involved in an accident off Christmas Island.

"This response is ongoing and the AFP's (Australian Federal Police) priority is the safety of all involved in the incident," police said in a statement.

Stewart said he saw at least one person rescued by navy personnel, while others clung to bits of flotsam and jetsam from the boat.

"We did however witness one person jumping off a piece of flotsam and actually swimming towards a naval rescue boat, but unfortunately what we witnessed was a major tragedy," Stewart said.

"We only witnessed one person surviving while the others unfortunately didn't."

Another witness told Sky News there were "naked people, children dead in the water" and that dozens were killed after the boat capsized and was then dashed against the rocks in rough seas.

The unnamed source said there were about "60 people in the water" and that "about 30 people were rescued" after a naval vessel rushed to the scene" as horrified Christmas island residents watched from the top of the cliff.

Christmas Island shire councillor Kamar Ismail said he saw at least two or three bodies in the water and that conditions had hampered the rescue.

"We were throwing out ropes and lifejackets but no one could grab on to the ropes," he told the West Australian newspaper.

"I saw children hanging onto the side of the boat just holding on. There were all others hanging on to rocks and what was left of the boat.

"Wave after wave was coming in and it was very, very rough. The rocks were very jagged and it's a very steep area around there."

"It was just a horrible situation, just so sad. But what can you do? We tried very hard to help and so many people couldn?t get out."

Michael Foster, another of the island's residents, said the navy was "doing their best" but the conditions were too rough for them to get close to those in the water.

"Most of the people were right next to the rocks," Foster told Sky News. "You could hear the women screaming, it was trying times for people trying to help them."

"I would suggest that I saw about 30 that didn't make it," he added.