"We heard the attackers chanting 'burn, burn' and 'kill, kill'," Zaki Firdaus, one of the sect's members said. "It was horrifying."
Approximately 300 people set the mosque on fire and destroyed an Islamic school building inside the Ahmadiyah compound located in the town of Sukabumi, just after midnight.
Many members of the sect have since fled the area, seeking refuge with family and friends nearby.
Around 200 people living in the mosque's compound also escaped from the area before the protesters arrived.
The police were called, "but the attackers came faster" Firdaus said.
The attack was the latest targeting the Ahmadiyah sect in Indonesia, the world's most populous Muslim nation.
Last week a team of prosecutors, religious scholars and government officials said the sect "had deviated from Islamic principles" and recommended that it be outlawed.
There have been several acts of vandalism targeting Ahmadiyah since then including a mass rally that was staged by thousands on Sunday.
Four mosques have been destroyed since the April 16 announcement.
"Ahmadiyah followers have been persecuted for years, but last week's recommendation prompted an escalation," Syamsir Ali, an Ahmadiyah spokesman said.
It was "like a poison, not a medicine for this nation", Ali said. "We don't know what will happen with us tomorrow."
Some Muslims consider Ahmadiyah "heretical" in part because it does not consider Muhammad to be the final prophet. The sect was founded towards the end of the 19th century in Pakistan.