The incident – which involved the Stena Feronia and the ‘Union Moon’ cargo vessel – happened at 7.45pm on Wednesday evening close to the Fairway Buoy on the Co Down coast.
The ferry had left the Merseyside’s Birkenhead on a morning sailing and was on the final stretch to Belfast when the collision took place.
Fifty-one passengers and 47 crew onboard have been taken off the Stena Feronia, a spokesperson from the company has confirmed.
There are no reports of any injuries at this stage.
It is understood the Stena ferry has now docked at the Stena terminal, while the other vessel remains at the scene as instructed by Belfast Harbour.
Police are assisting the Maritime and Coastguard agency to investigate the incident.
Ulster Unionist MLA Roy Beggs said: “First and foremost there will be a great deal of relief that this incident did not result in casualties as we could have been dealing with a tragedy and there will also be concern as to how this was able to happen in the first place.
“Many people will rightly be asking just how two modern vessels with state of the art navigation equipment can collide in a major shipping lane.
The East Antrim politician concluded:”This question must be answered in order to maintain public confidence and to ensure that the excellent safety record is maintained.”
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