The fuselage, the part of the plane that holds pilots and passengers, was discovered around 3 kilometres from where the tail of the aircraft was retrieved last weekend at the bottom of the Java Sea, Indonesian officials said.
"A marker was placed on the engine. Beside the engine is the fuselage, the wing and a lot of debris," Ony Soeryo Wibowo, an investigator with the National Transportation Safety Committee, told Reuters.
Indonesia AirAsia Flight QZ8501 lost contact with air traffic control in bad weather on Dec. 28, less than halfway into a two-hour flight from the city of Surabaya to Singapore. All 162 people on board were killed.
So far 50 bodies have been plucked from the Java Sea, with most brought to Surabaya for identification. Searchers believe more bodies will be found in the plane's fuselage.
Divers will check the wreckage for bodies on Thursday, said Fransiskus Bambang Soelistyo, head of the National Search and Rescue Agency.
Indonesian investigators started examining on Wednesday the black box flight recorders recovered from the Airbus A320-200, and hope to unlock initial clues to the cause of the disaster within days.
Divers retrieved the flight data and cockpit voice recorders this week from the plane's sunken wreckage.
The recorders were lifted from the bottom of the Java Sea and sent to the capital, Jakarta, for analysis. Both were found to be in relatively good condition.
"In one week, I think we will be getting a reading," Mardjono Siswosuwarno, head investigator for the National Transportation Safety Committee (NTSC), told Reuters.
The so-called black boxes - which are actually orange - contain a wealth of data that will be crucial for investigators piecing together the sequence of events that led to the plane plunging into the sea.
The flight data recorder took only 15 minutes to download, but investigators will now need to analyse up to 25 hours of data and several thousand flight parameters covering things such as flying speed, altitude, fuel consumption, air pressure changes and inputs to the aircrafts controls.
"We are feeling relieved but there is still a lot of work ahead of us to analyse it," said Siswosuwarno.
Investigators were also expected on Wednesday to begin downloading data from the cockpit voice recorder, which retains the last two hours of conversations on the flight deck and between the pilots and air traffic controllers.
As is standard procedure, the NTSC will file a preliminary report, which will be made public, to the International Civil Aviation Organization within 30 days. A final report on the crash is not expected to be published for at least a year, Siswosuwarno said.
After the recovery of the two black boxes, Indonesia is expected to scale back search and rescue operations in the Java Sea.
But government officials sought to reassure victims' families that efforts to retrieve the remains of their loved ones would continue.
"We understand if the search becomes smaller ... but the bodies have to be found," said Frangky Chandry, whose younger brother was on the plane.
"We want to bury our family. That's what we want."