Similar vessels carrying cocaine have been discovered off Colombia and Central America, but navy spokesman Capt. Benjamin Mar said the seizure is a first for Mexico.
The 30-foot makeshift submarine was detected heading north about 200 miles off the southern state of Oaxaca, Mar said.
The green-topped, arrowhead-shaped vessel was intercepted when it surfaced hours later, and the crew was taken into custody without resistance.
The suspects were flown by helicopter to the city of Huatulco, where they told reporters they left the Colombian coastal town of Buenaventura a week ago.
The crew members said they were fishermen forced to make the journey by drug traffickers who threatened to harm their families.
"We didn't know what was on board because we never saw it. It was sealed," said one of the four, Jose Felix Enriquez.
The navy said in a statement that the sub was apparently packed with cocaine, but authorities were still determining how much was on board.
Colombia's drug cartels have been known to use home-built submarines to smuggle large amounts of cocaine past U.S. and Colombian patrol boats to Central America en route to the United States.
Colombian authorities have discovered at least nine such vessels over the past three years. Last August, U.S. forces intercepted a submarine-like vessel packed with tons of cocaine off the coast of Guatemala.