TOKYO, Nov 29 (Reuters) - A U.S. military aircraft with eight people onboard crashed into the sea in western Japan on Wednesday with fishermen reporting three people had been found but that their condition was unknown.

The coast guard said it had sent patrol boats and aircraft to the area where the tilt-rotor V-22 Osprey crashed off the island of Yakushima.

Fishing boats in the area found three people in the surrounding waters, a representative of a local fisheries cooperative said.

The crash happened about 2.47pm local time (0547 GMT) near the island's airport, with witnesses saying the aircraft's left engine appeared to be on fire as it descended, Japanese media reported, citing local authorities.

The aircraft had disappeared from radar shortly before the crash, Japan chief cabinet secretary Hirokazu Matsuno said.

In August, a US Osprey crashed off the coast of northern Australia while transporting troops during a routine military exercise, killing three US Marines.

Another crash-landed in the ocean off Japan's southern island of Okinawa in December 2016, prompting a temporary US military grounding of the aircraft.

The tilt-rotor plane, which can fly as a helicopter or a fixed-wing aircraft, is operated by the US Marines, US Navy and the Japan Self Defence Forces.

The deployment of the Osprey in Japan has been controversial, with critics saying the hybrid aircraft is prone to accidents. The US military and Japan say it is safe.