The North Korean ship, believed to be a fishing vessel, capsized after crashing with a Japanese patrol boat Okuni some 350 kilometres (217 miles) northwest of Noto peninsula in Ishikawa prefecture in central Japan.
The coastguard says there are an unspecified number of casualties. Rescuers have retrieved four bodies from the water as well as several survivors so far.
Rescue operations are underway, but those who have disappeared are "probably dead," a coastguard spokesman said.
Favourable weather conditions have prompted a surge in departures of refugees from the Libyan coast.
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