The two Balclutha men haven't been seen or heard from since last night.
A police spokeswoman said the two men were recreational paua divers from Balclutha.
They entered the water at Purakaunui Bay but the search was covering more than 20km of coastline from Long Point to Nugget Point.
The police national dive squad were on their way to the scene and are expected to join the search from dawn tomorrow, concentrating on Purakaunaui Bay itself.
The men were 23 and 51-years-old and were not related, she said.
Search teams were deployed immediately and worked until midnight yesterday but unfortunately did not locate the men.
They were reported overdue about 7.30pm last night. The search resumed this morning.
A ground and water search was being conducted, and a helicopter had also been called in.
Five boats out on the water and surf life savers are among those helping search for the two divers.
Search coordinator, Snr Const Murray Hewitson, of Owaka, said weather and sea conditions at and since the time the men were believed to have entered the water had been "ideal".
"Visibility has been good, and the coastal waters relatively calm."
Otago Surf Life Saving SAR teams returning to Purakaunui Bay this afternoon also reported search conditions had been good.
Periodic heavy showers fell during the day, with little or no breeze. MetService information showed air temperatures varying between 8degC and a high of 13degC, and seas temperatures steady at 12degC.
