Navy divers found the bodies on Friday morning of two missing seamen from the Shelly, the general cargo ship that sunk in Haifa Bay on Thursday night after colliding with a Cypriot passenger liner.
Army Radio reported that the bodies of the two, one of whom was Indonesian and the other Ukrainian, were discovered inside the ship's hull, where rescue teams were still trying to extract them and bring them to shore.
The dead men were the ship's first mate and engineer, both residents of Slovakia, according to police.
The search for the two missing seamen was resumed Friday morning after it was halted due to difficult search conditions late Thursday night.
"Navy divers retrieved the bodies... at a depth of 20 meters," the IDF said. "The rescue efforts included six naval ships with doctors and medics, and IDF aircraft that assisted in the search."
Magen David Adom said its teams were waiting on the shore for the arrival of the bodies.
Meanwhile, the Salamis Glory cruise ship, which has approximately 500 passengers on board, was instructed to dock in Haifa until the investigation of the collision is completed. Police reportedly detained the ship's captain for questioning while the passengers remained on board.
Cypriot shipping official Sergios Sergiou told the Cyprus News Agency his government would send inspectors to Israel to assist with the investigation.
The Shelly was anchored three kilometers from the coast, near Haifa, when it was hit by the Cypriot vessel, Israel Navy V.-Adm. Ram Rutberg told reporters on Friday.
According to Haifa Port officials, the accident occurred after the Salamis Glory's steering system encountered technical problems. Israel Radio reported that the passenger liner literally cut the cargo ship in half.
The passenger ship was not seriously damaged and no one aboard was hurt.
Eleven of the cargo ship's 13 crew members managed to escape their sinking craft in a rescue launch lowered by the cruise ship and were picked up by the navy, Rutberg said.
The Shelly was Israeli-owned but the crew members are foreigners, most of them Slovaks.
The Salamis Glory boasts a swimming pool, gym, bars, restaurants, a casino, duty-free shop and a discotheque. It offers two- and three-day cruises to Israel, Egypt and the Greek islands.