The incident occurred on Saturday at The Bay of Plenty, The Citizen newspaper said.
A "freak wave" swept people out to sea at the eThekwini beachfront, which resulted in three dead and 17 injured, the newspaper said citing emergency medical services.
"There was a freak wave that washed some people to sea, three have drowned and 17 people have been taken to hospital," Robert Mckenzie, spokesman of the KwaZulu-Natal provincial first responders said in a statement to AFP.
The Bay of Plenty is one of Durban's most popular beaches. A massive rescue operation took place, involving 35 lifeguards. Paramedics also attended to over 100 beach goers, but only 17 were seriously injured.
The injured are in serious and critical condition at nearby hospitals.
Beaches in Durban, South Africa's third-largest city, have been gradually reopened after being closed due to high levels of E. coli bacteria coming from the city's sewage system, which was hit hard by the worst floods in living memory, that killed more than 400 people in April.