Australia's Defence Department confirmed the Osprey vertical takeoff aircraft had been carrying US "defence personnel", and said that it appeared no Australian soldiers were involved.

"At this critical early stage, our focus is on the incident response and ensuring the safety of those involved," the department said in a statement.

The aircraft was involved in drills near the Tiwi Islands north of Darwin, and several people have reportedly been rescued, according to Australian public broadcaster ABC.

An emergency services incident map for the Northern Territory said there had been an "aircraft crash" on Melville Island, some 60 kilometres (37 miles) north of the Australian mainland on Sunday morning.

The Osprey was taking part in the Predators Run exercises, a joint series of warfighting drills held between the US and Australian militaries.

Ospreys are tilt-rotor aircraft that combine the vertical takeoff ability of a helicopter with the speed of a turboprop plane, according to the US Air Force.