A vessel carrying 10 men left Daru Island, south of Papua New Guinea, on Sunday to fish near Warrior Reef, about 20 nautical miles west of Yorke Island.
"Some time on Sunday or Monday the vessel overturned, throwing all on-board into the water," police said.
Three of the men were rescued by a passing fishing boat on Monday and returned to Daru Island.
The remaining crew are still missing.
The boat was found washed up between the villages of Mabuduan and Old Mawatta on the PNG mainland on Wednesday.
Thursday Island water police were notified this morning and an air and sea search was launched.
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