The ferry, carrying cars and fruit under a Sierra Leone flag, caught fire near the port of Sochi Friday morning. A total of 31 people on board, including the crew, were safely evacuated.
"The blaze has been contained, but fires are still burning near the engine room and the afterbody," officials said.
The burning ferry, which blocked access to the port, was towed 12-14 nautical miles out to sea at night and the extinguishing efforts were continuing there. The owners have requested the ferry to be towed to Turkey, the officials said.
The cause of the blaze has not been reported so far.
Sochi, popular for its beaches and mountain ski resorts, won the 2014 Winter Olympics bid in July and is in for massive reconstruction and development.