At least 191 exhausted people have been found alive, either packed into lifeboats, clinging to debris or on beaches after swimming ashore, according to Hatta Radjasa, the transport minister.
State news agency Antara earlier said the bodies of 66 people had been located, many in waters and on beaches near Rembang on Central Java's coast.
However, Aiptu Pitoyo Adi, a Rembang police official told Reuters that while fishermen who found the 66 assumed they were dead, some might still be alive but unconscious.
Captain Hadi Siswanto, a search official, said on Monday rescue boats continued to collect scores of corpses from choppy waters in the Java Sea.
Officials in Rembang were readying more than 200 body bags at the port while workers at the town's hospital built a makeshift tent mortuary for the bodies.
The ferry was carrying 545 passengers and 57 crew when it sank. It was licensed to carry 850.
Officials said they lost contact with the vessel at around midnight (17:00 GMT Friday) when it was off the Java coast.