The US Marine Corp said the Boeing MV-22B Osprey tilt-rotor aircraft was carrying 23 American personnel when it crashed during a routine training exercise about 9.30am on Sunday.
"Three have been confirmed deceased while five others were transported to Royal Darwin Hospital in serious condition," a spokesman said in a statement.
"The Marines aboard the aircraft were flying in support of Exercise Predators Run.
"Recovery efforts are ongoing.
"The cause of the incident is under investigation."
Royal Darwin Hospital has declared a code brown in response.
NT Police Commissioner Michael Murphy said an emergency operation centre set up to tackle fires in the territory had been redeployed to the crash site, with more injured to be transported.
"We are working closely with the Australian defence force, the US Marine Corp and other agencies such as Careflight to rescue and return those injured personnel to Darwin," he told reporters on Sunday.
The national critical care and trauma response team has been deployed and is triaging patients at the crash site before they are transported.
"We are doing everything we can to return them safely back to Darwin for treatment," Mr Murphy said.
He said the area where the crash occurred is remote, making moving the injured to hospitals difficult.
NT Chief Minister Natasha Fyles confirmed the Royal Darwin Hospital had activated a code brown, the highest emergency response that can be activated at an Australian hospital.
She said the immediate focus was on getting the injured to hospital for treatment.
"We're using Careflight airframes, both fixed wing and rotary, to respond, to get those people to Darwin into the care that they need," she said.
She said three operating theatres have been cleared as well as several wards as the hospital prepares to receive the dozens of injured marines.
Darwin's private hospitals were also on alert.
"Some people are critically injured, and so we're focused on making sure that they get that level of care that they need," she said.
"That is our ultimate priority right now is getting people across from the island to Darwin to receive that care."
She said the site on Melville Island had been secured, and she was in contact with the US consul to assure them the NT's resources were fully focused on the response.
The Department of Defence said the incident occurred during Exercise Predator's Run 2023.
"Initial reports suggest the incident involves United States defence personnel and that Australian Defence Force members were not involved," a Defence spokesperson said.
"At this critical early stage, our focus is on the incident response and ensuring the safety of those involved."
Prime Minister Anthony Albanese, speaking in Karratha, said the Australian Defence Force was working with its US partners to offer any assistance needed.
"Our focus as a government and defence department is on incident response and support at this difficult time," he said.
"We are focused on providing practical assistance on the ground.
"Obviously this is a regrettable incident."
He declined to comment asked whether all personnel involved in the crash had been accounted for.
"We want to make sure that any information provided is accurate," he said.
"We do follow protocol at times like this.
"This is a difficult incident.
"We are responding fully."
About 150 US Marines are stationed in Darwin and taking part in military drills alongside personnel from Australia and the Philippines.
9°C