Video broadcast by TVOne showed other ships in the background as the ferry, Rafelia 2, sank in the narrow Bali Strait.
"We discovered one body and are searching for four missing persons", an official said.
"But the helmsman and a desk officer are still missing", Mr Yusuf Hadi, a general manager for ASDP Indonesia Ferry in charge of the service, was quoted by Jakarta Globe in a statement.
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The ferry was traveling from Gilimanuk port in Bali to Banyuwangi on Java. The vessel was proceeding from Gilimanut to Ketapan with 25 vehicles and hundreds of passengers on board, but capsized in relatively calm sea.
At least 71 people were rescued after the accident in the Bali Strait on Friday, said Johan Saptadi, the head of the Search and Rescue Agency in East Java. According to information gathered by state news agency Antara, the cargo ship's manifest indicates that the ship was carrying 72 passengers - including 14 crews and six technical college interning aboard the ship. The cause of the accident was under investigation.
He said that the rescue operation on Saturday involved those from Bali and Java search and rescue offices, navy, and the police.