Crews were on standby to descend to a large object detected by sonar on the ocean floor, lying just 30-50 metres (100-165 feet) deep. Rescuers believe it is the Airbus A320-200, which was carrying 162 people when it crashed on Sunday en route from the city of Surabaya to Singapore.
"I am hoping that the latest information is correct and aircraft has been found," airline boss Tony Fernandes tweeted on Thursday. "Please all hope together. This is so important."
But Toos Sanitiyoso, an air safety investigator with the National Committee for Transportation Safety, said the black box flight data and voice recorders could be found within a week, suggesting there was still doubt over the plane's location.
"The main thing is to find the main area of the wreckage and then the black box," he told reporters.
None of the tell-tale black box "pings" had been detected, he said.
"There are two steps of finding the black box. One is we try to find the largest portion of the wreckage," he said.
Divers would not be sent into the water without a target, search official Sunarbowo Sandi said.
"They wouldn't go in without it," he said. "The divers are not searching."
Frogman commander Lieutenant Edi Tirkayasa said the weather was making the operation extra hard.
"What is most difficult is finding the location where the plane fell - checking whether the aircraft is really there," he told Reuters.
"This is very difficult even with sophisticated equipment. With weather like this, who knows? We are still hopeful and optimistic that they'll find it. They must."
Investigators are working on a theory that the plane stalled as it climbed steeply to avoid a storm about 40 minutes into the flight.
So far, at least seven bodies have been recovered from waters near the suspected crash site, along with debris such a suitcase, an emergency slide and a life jacket.
The bodies are being taken in numbered coffins to Surabaya, where relatives of the victims have gathered, for identification. Authorities have been collecting DNA from relatives to help identify the bodies.
"We are asking universities to work with us - from the whole country," said Anton Castilani, executive director at Indonesia's disaster victims identification committee.
Most of those on board were Indonesians. No survivors have been found.
Relatives, many of whom collapsed in grief when they saw the first grim television pictures confirming their fears on Tuesday, held prayers at a crisis centre at Surabaya airport.
"UNBELIEVABLY" STEEP CLIMB
The plane was travelling at 32,000 feet (9,753 metres) and had asked to fly at 38,000 feet to avoid bad weather. When air traffic controllers granted permission for a rise to 34,000 feet a few minutes later, they received no response.
A source close to the probe into what happened said radar data appeared to show that the aircraft made an "unbelievably" steep climb before it crashed, possibly pushing it beyond the Airbus A320's limits.
"It appears to be beyond the performance envelope of the aircraft," he said.
The source, who declined to be identified, added that more information was needed to come to a firm conclusion.
Online discussion among pilots has centred on unconfirmed secondary radar data from Malaysia that suggested the aircraft was climbing at a speed of 353 knots, about 100 knots too slow, and that it might have stalled.
Some of the bodies recovered so far have been fully clothed, including a flight attendant in her uniform. That could indicate the Airbus was intact when it hit the water and also support the aerodynamic stall theory.
The Indonesian captain, a former air force fighter pilot, had 6,100 flying hours under his belt and the plane last underwent maintenance in mid-November, according to AirAsia Indonesia, which is 49-percent owned by Malaysia-based budget carrier AirAsia.
Three airline disasters involving Malaysian-affiliated carriers in less than a year have dented confidence in the country's aviation industry and spooked travellers.
Malaysia Airlines Flight MH370 disappeared in March en route from Kuala Lumpur to Beijing with 239 passengers and crew and has not been found. On July 17, the same airline's Flight MH17 was shot down over Ukraine, killing all 298 people on board.
On board Flight QZ8501 were 155 Indonesians, three South Koreans, and one person each from Singapore, Malaysia and Britain. The co-pilot was French.
The AirAsia group, including affiliates in Thailand, the Philippines and India, had not suffered a crash since its Malaysian budget operations began in 2002.
Separately, an AirAsia Indonesia pilot was taken off flying duties on the route from Jakarta to the holiday island of Bali on Thursday after a urine test indicated traces of morphine.
"From our early interview with the pilot, he said he was hospitalised for typhus and was infused from Dec 26-29," airline CEO Sunu Widyatmoko told reporters.
"Until today, he still consumes medication. One of them is Actifed (a cough syrup). In a narcotics test, cough medication could cause the false alarm of drug intake."