A video shot by an onlooker showed a huge slab of rock sliding off the 200-metre cliff face above Navagio beach and crashing onto the sand, narrowly missing two people below.
None of the injuries sustained in the incident on Thursday afternoon are believed to be life-threatening.
Josh O'Connell, 21, of Kilkenny, Ireland, who works for a tour company on Zante, said there were more than a dozen tourist boats in the bay and 400-500 people in the area.
The coast guard said one foreign woman was injured and was being transported to a local hospital.
He said: "The rock that fell would be like a four-storey building falling on to the beach". According to the reports, six people were slightly injured including two children.
A couple of small vessels overturned from the force of the fall that caused high waves, witnesses told authorities.
It is not clear how many people were on the beach, which lies at the foot of a 200-metre cliff, at about... She said they heard an "almighty cracking sound" as the sheet of rock crashed down onto the beach, flooding the busy beach and capsizing boats.
Rescue services with sniffer dogs are searching the beach for possible victims.
Authorities evacuated and shut down access to the beach, which can only by reached by boat, as a precaution.
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