Costa Allegra – sister ship to the stricken Costa Concordia – has sent a distress signal to Italian lifeguards after fire left it without power in the Indian Ocean.
More than 1,000 people - 636 passengers and 413 crew members - are onboard the vessel.
Power was lost after fire broke out near the generators, reports have said.
All passengers are believed to be safe, with the fire now extinguished.
Coast Guard Cmdr. Cosimo Nicastro told SkyTG24 TV the Italian coast guard has dispatched cargo ships near the Allegra to help.
The Seychelles is also sending a motorboat, a plane and two tugboats to the scene.
In a statement Costa said there were no injuries following the incident, with staff working to “restore functionality” to the ship.
More than 30 people died earlier this year when the Costa Concordia sank off the coast of Italy.