Workers doused the stricken No.1 reactor with sea water to try to avert catastrophe, in what US experts warned was an "act of desperation" that, in the worst-case scenario, could foreshadow a much more serious disaster.

Japan battled a feared meltdown of two reactors at a quake-hit nuclear plant Sunday, as the full horror of the disaster emerged on the ravaged northeast coast with thousands feared dead.

An explosion at the ageing Fukushima atomic plant blew off the roof and walls around one of its reactors Saturday, a day after the biggest quake ever recorded in Japan unleashed a monster 10-metre (33-foot) tsunami.

The atomic emergency widened Sunday as the cooling systems vital for preventing overheating failed at a second reactor. In a nightmare scenario, back-up generators were disabled by tsunami flooding.

Asked whether meltdowns had occurred, Japan's top government spokesman Yukio Edano said: "We are acting on the assumption that there is a high possibility that one has occurred" in the plant's number-one reactor.

"As for the number-three reactor, we are acting on the assumption that it is possible," he said of the plant situated 250 kilometres (160 miles) northeast of Tokyo.

Edano said some radiation had escaped, but that the levels released into the air had so far not reached levels high enough to affect human health.

The colossal 8.9-magnitude tremor sent waves of mud and debris racing over towns and farming land in Japan's northeast, destroying all before it and leaving the coast a swampy wasteland.

In the small port town of Minamisanriku alone some 10,000 people were unaccounted for -- more than half the population -- public broadcaster NHK reported.

As the world's third-largest economy struggled to assess the full extent of what Prime Minister Naoto Kan called an "unprecedented national disaster", groups of hundreds of bodies were being found along the shattered coastline.

"We have received a preliminary report that more than 200 bodies were found in the city of Higashimatsushima," a National Police Agency spokesman said in the latest find on Sunday.

Edano said at least 1,000 people were believed to have lost their lives, and police said more than 215,000 people were huddled in emergency shelters.

In the city of Fukushima, about 80 kilometres (50 miles) northwest of the stricken plant, AFP reporters saw panic buying at supermarkets and said petrol stations had run dry.

In Minamisoma town, which was virtually obliterated by the tsunami's black tide of mud and debris, an AFP reporter saw fire volunteers collecting bodies found in the twisted wreckage of what had once been a residential area.

The International Atomic Energy Agency said about 200,000 people had so far been evacuated from the area around the two Fukushima plants that house a total of 10 reactors.

Japan's nuclear safety agency rated the incident at four on the international scale of zero to seven. The 1979 Three Mile Island accident in the United States was rated five, while the 1986 Chernobyl disaster was a seven.
 
After Saturday's blast, which sent smoke billowing into the sky, the government moved to calm growing fears, saying the explosion did not rupture the container surrounding the reactor itself.

Workers doused the stricken No.1 reactor with sea water to try to avert catastrophe, in what US experts warned was an "act of desperation" that, in the worst-case scenario, could foreshadow a much more serious disaster.