Authorities shut down access to the beach, which lies at the foot of a 200-metre (650-foot) cliff and is accessible only by boat, as a precaution.
The landslide occurred Thursday on the Navagio Beach, or Shipwreck Beach, on the northwestern coast of the island.
Seven people were injured, with one woman suffering back injuries.
Their injuries were not life-threatening, fire brigade and coast guard officials said.
Video footage of the terrifying moment showed the rock from the limestone cliff face split and plummet to the shore, sending waves crashing over tourists.
Among those injured was a 34-year-old woman from the Czech Republic, who suffered a fractured vertebra.
Another six people, including two children, had received treatment for minor injuries, a hospital official in Zakynthos told Reuters. The rock was so large, it caused a small tsunami, with large waves crashing onto the beach.
Rescue services with sniffer dogs are searching the beach for possible victims.
He said: "I thought more was coming and I just started running". She said they heard an "almighty cracking sound" as the sheet of rock crashed down onto the beach, flooding the busy beach and capsizing boats. O'Connell described the chaos, with families scrambling to rush to safety on the boats in the bay.
The coast guard said later that those who had headed to the beach on tourist boats had all been accounted for.