They were spotted east of Atlantic City by a Coast Guard helicopter out of Elizabeth City, New Jersey around 7:00 p.m. Monday.
There was no word yet on when the men would be brought back to shore.
The sport-fishing boat left Saturday morning and was set to return Sunday morning. When they weren't home by Sunday night, the authorities were called.
The search for the 32-foot vessel, Black Magic, initially focused on the area near where the men had planned to go fishing.
But a Coast Guard radio tower on Martha's Vineyard picked up a mayday call around 1 a.m. Monday, Coast Guard Petty Officer Jonathan Lindberg said. A recording of the call was played for families of the missing, one of whom recognized the voice as that of her husband.
Stay with Action News and 6abc.com as this story develops.