A Norwegian diving instructor was rescued alive on Thursday a day after going missing off Malaysia's southeast coast but three other Europeans were still missing, officials said. 

Kristine Grodem, 35, was found in the water in the morning by a passing vessel, a significant distance from where the group had disappeared. 

She was then picked up by a helicopter involved in the search effort and taken to nearby Mersing district, police official Cyril Edward Nuing said. She is in hospital in a stable condition.

Helicopters, boats and dozens of divers are hunting for the others -- a 46-year-old British man and his son, a 14-year-old male Dutch citizen, and an 18-year-old Frenchwoman.

Police also revealed the boat captain who had taken the group to the diving site had been arrested after testing positive for drugs, without giving further details. 

Grodem had been instructing the divers close to a small island about 15 kilometres (nine miles) off the coast when the accident happened, authorities said. 

The group was in the water for 40 minutes. When they surfaced, they could not see their boat and drifted in strong currents, Nuing told reporters.

"The instructor tried to keep all of them together but they got separated," he said. 

"We believe the three victims will be found safe as they are experienced divers."

The area where they disappeared is popular with foreign and domestic visitors -- there are resorts dotted along the coast and on nearby islands.

Diving accidents, while rare, do occasionally take place in Malaysia. 

In 2013, a British tourist died when she was struck by a passing boat's propeller while diving off resort islands in the South China Sea. 

The tropical Southeast Asian nation's white-sand beaches and lush rainforests have long made it a major draw, but the tourism industry was hit hard by travel curbs during the coronavirus pandemic. 

The country's borders reopened to foreign tourists last week after a two-year closure.