Twenty-three of the 26 personnel aboard the Osprey heli-plane, also known as a tilt-rotor, have been rescued.
The aircraft had launched from the USS Bonhomme Richard (LHD 6) and was conducting regularly-scheduled operations when it crashed into the waters.
Vessels and aircraft from the 31st Marine Expeditionary Unit and the Bonhomme Richard Expeditionary Strike Group immediately responded and were taking part in the rescue operation.
The aircraft was described as a MV-22 and was assigned to the Marine Medium Tiltrotor Squadron 265 of the 31st Marine Expeditionary Unit.
Australian Defense Minister Marise Payne said no Australian defense force personnel were on board the aircraft.
She added that Australian Prime Minister Malcolm Turnbull had been briefed on the situation and had spoken with U.S. Secretary of Defense James Mattis.