The victims were hiding aboard the Superfast III, when a fire on a vehicle deck late on Monday forced the evacuation of 307 passengers and most of its 106 crew.

The dead were believed to be Iraqi Kurds who died of smoke inhalation. The authorities fear more stowaways may have been killed.

"We have located 10 bodies, eight men and two women," a Merchant Marine Ministry statement said.

Iraqi Kurds seeking a new life in the West

The fire broke out shortly after the passenger ship sailed from the Greek port of Patras for Ancona in Italy.

A spokesman for ferry owners Attica Enterprises said it was thought to have started on one of more than 100 trucks on the ferry, but it was too early to estimate the extent of the damage to the ship.

One passenger was injured when he jumped into the water to escape the flames, while another suffered leg burns. Two crew members were also slightly injured.

The Merchant Marine Ministry initially said that there had been no casualties. But fire fighters discovered the dead bodies when they went to inspect the damage on Tuesday.

Illegal immigration

The incident is the second in a week in which illegal immigrants have died trying to find a better life. At least five Iraqi Kurds were killed and 10 injured on Sunday when they entered a minefield after illegally crossing into northern Greece from Turkey.

Greece is used as a transit point by many illegal immigrants from Asia and the Middle East, who enter the country in the hope of moving on to other European Union destinations.

Many pay boat owners thousands of dollars to bring them from the Turkish coast to the Greek islands and others illegally cross Greece's northern borders.

The Attica spokesman, Yannis Kritikos, said no one had been aware the immigrants were on board.

He said stowaways were a common problem for ships sailing from Greece to Italy.