A doctor has told Indonesian TV that at least 30 people are dead in a small city on the island of Sulawesi after a tsunami of up to three metres hit the area.

Doctor Komang Adi Sujendra told Metro TV that 30 people had been killed in the bay city of Palu after an earthquake offshore lead to a tsunami hitting the city.

Authorities were having difficulties coordinating rescue efforts as the magnitude-7.5 quake caused a power outage that cut communications around Palu and the nearby fishing town of Donggala, the closest to the epicentre of the quake, 27km away.

Videos circulating on social media show a powerful wave hitting Palu with people screaming and running in fear.

Indonesian disaster agency spokesman Sutopo Purwo Nugroho said houses were swept away by the tsunami and families had been reported missing.

Dwikorita Karnawati, who heads Indonesia's meteorology and geophysics agency, BMKG said authorities received information that Palu had been hit amid a rapid series of aftershocks.

"The situation is chaotic, people are running on the streets and buildings collapsed. There is a ship washed ashore," Ms Karnawati said.

He said communications with central Sulawesi were down, and the search and rescue effort was being hampered by darkness.

The national search and rescue agency will deploy a large ship and helicopters to aid with the operation, agency chief Muhammad Syaugi said, adding he had not been able to contact his team in Palu.

Palu, hit by a magnitude-6.2 quake in 2005 which killed one person, is a tourist resort at the end of a narrow bay famous for its beaches and water sports.

Earlier on Friday, the National Disaster Mitigation Agency (BNPB) said it was having difficulty reaching some authorities in Palu and the fishing town of Donggala, closest to the epicentre of the quake 80 kilometres away at a shallow 10 kilometres underground.

Palu airport was closed.

The area was hit by a lighter quake earlier in the day, which destroyed some houses, killing one person and injuring at least 10 in Donggala, authorities said.

More than 600,000 people live in Donggala and Palu.