Local fishermen and boat owners from the island of Saint Maarten spent hours ferrying the passengers off the Monarch of the Seas, owned by Royal Caribbean International.
The six-year-old ship struck the reef sometime before 6:00 p.m. on Tuesday, and was taking in water fast when the captain purposely beached in a nearby bay on the Dutch side of the island. The other side of Saint Maarten is the French territory.
Three of its 18 watertight compartments started to take on water, but a rapid response from islanders in the Caribbean averted disaster after the 74,000-ton luxury liner began to sink.
Crew members deployed a boom around the ship immediately after the grounding to contain any oil spill, but no leaks were reported. A U.S. Coast Guard helicopter crew was to further survey the area for any signs of pollution.
Upon hearing of the incident, local boat owners and fishermen successfully mounted the mass rescue operation. Within four hours, all 2,557 passengers and 831 crew staff were ferried to safety.
The incident occurred as the ship was headed for the French island of Martinique. The Monarch regularly ferries passengers from San Juan, Puerto Rico, around the Caribbean during the current high season.