Officials said the latest count showed that only two of the 126 passengers on board were still missing.
Bahrain television showed pictures of rescue workers using pickaxes to try to break through the bottom of the upturned vessel, which was still floating off the coast of Bahrain.
Nawaf Hamza, a Bahraini prosecutor, said: "The captain was only a sailor and not qualified to operate the ship. The prosecutor's office has detained him and his assistant.
"Initially charges against him are linked to his responsibility [for the accident]."
Hamza said the ship was heavily overloaded with passengers when it set off on a corporate dinner cruise in the Gulf.
Rescuers pulled 67 survivors from the water, helped by the US Navy's 5th Fleet, which is based in Bahrain.
The boat's owner, quoted earlier by Al Arabiya television, said the top-heavy vessel capsized when passengers gathered on one side.
Witness Aqeel Mirza said he was about 100 metres away on another vessel when he saw the boat capsize.
"The sea was calm, there were no heavy winds or waves," he told Arabiya.
"Suddenly, in that instant that we were watching it, the boat overturned very quickly. It just overturned on one side in seconds, and two seconds later the lights went out and then we started hearing the screaming."
Mirza said it took more than 25 minutes for rescue boats to arrive at the scene.
"Most of who died were inside the enclosed restaurant," he said. "Those who were on the top deck found it easier to survive because they jumped off the boat and waited for rescue."
The boat trip was for employees of companies involved in a construction project in Bahrain and their families.