The eruption Sunday evening caused a landslide that collapsed the western part of Jabal al-Tair island, the Yemeni news agency SABA reported. There were no immediate reports of deaths.
The tiny oval island, about two miles wide, lacks a settled population but includes military installations used for naval control and observation because large cargo ships pass nearby.
It was not clear how many people were stationed on the island, and SABA reported that Yemeni ships had evacuated all personnel and were searching for eight missing military personnel.
A NATO fleet passing nearby reported seeing a "catastrophic volcanic eruption" at 7 p.m. local time Sunday on the island, about 70 miles off the Yemeni coast, said Ken Allan, a Navy Public Affairs with the Canadian Armed Forces.
"At this time, the entire island is aglow with lava and magma as it pours down into the sea," Allan said in an e-mail Sunday evening. "The lava is spewing hundreds of feet into the air, with the volcanic ash also (rising) a thousand feet in the air."
The NATO fleet was sailing toward the Suez Canal when it spotted the eruption. The government of Yemen asked NATO to assist in the search for survivors and the closet ship, the HMCS Toronto, was heading toward the island. The Canadian Armed Forces said they are trying to locate nine people believed to be at sea after the Yemen coast guard requested help. It is unclear why there was a discrepancy with the SABA report on the number of missing.
Jabal al-Tair - meaning "Bird Mountain" - is one of a number of volcanos at the southern end of the Red Sea in the narrows betwen Yemen and Sudan. The island last saw an explosive eruption in 1883, according to the Washington-based Smithsonian Institute's Global Volcanism Program.
Over the past two weeks, the area around the island had seen light earthquakes between magnitude 2-3.6, with three larger ones Sunday afternoon reaching magnitude 4.3, the Yemeni Ministry of Oil and Mineral Resources said, according to SABA. Fishermen and other boats had been warned from approaching the area, it said.
Yemen is a poor tribal Sunni Muslim country at the southern tip of the Arabian Peninsula.