Several online videos of the incident showed a turquoise and yellow trimmed party boat rocking back and forth before the lower deck submerged.
Shortly after that, the boat began sinking.
The El Almirante, a boat used for taking tourists on tours of the reservoir, sank shortly after 2:00 pm, reported El Colombiano.
Officials said that most tourists had either been rescued by other boats or escaped by themselves.
The reservoir, situated a short distance from Medellin in Antioquia department (geographical division like a state) in northwest Colombia, has been a popular tourist spot with paddle boarders and kayakers.
A flotilla of recreational boats and jet-skis rushed to the scene, pulling people from the boat as it went down and averting an even deadlier tragedy.
The reasons why the boat sunk remain unclear but survivors said the boat, called El Almirante, appeared to have been overloaded and none of the passengers on board were wearing life vests, according to Associated Press. "It all happened in a few minutes", said fire service captain Luis Bernardo Morales.
The Colombian government sent the Air Force and scuba divers to look for survivors. When he got to the shore people told him the ship had gone under. "We saw how they brought out several unconscious people".
The air force said a helicopter was on its way to help in rescue operations.
The reservoir is very close to Guatape, a municipality offering assorted tourist activities and which on Sunday registered a big inflow of tourists because Monday is a holiday in Colombia.