The items found by rescuers included parts of a torpedo straightener, a grease bottle believed to be used to oil the periscope and prayer rugs from the submarine, according to navy chief Yudo Margono.
“With the authentic evidence we found, believed to be from the submarine, we have now moved from the ‘sub miss’ phase to ‘sub sunk’,” Mr Margono told a press conference in Bali where the items were displayed.
The announcement came shortly after oxygen aboard the vessel known as KRI Nanggala 402 was believed to have run out.
Indonesian officials said on Friday that the submarine – which went missing off the island of Bali on Wednesday as it prepared to conduct a torpedo drill – would likely only have enough air to last until around dawn on Saturday if equipment was functioning properly.
A vast international search effort had been launched to find the submarine, with planes and warships from America, Australia, Singapore and Malaysia reportedly due to imminently join the rescue mission.
The Indonesian defence ministry said there were 49 crew members, three gunners and a commander aboard the boat – which is reportedly 19 more people than it would typically carry.
Earlier on Saturday, military spokesperson Djawara Whimbo said that a hydrographic vessel was still unable to detect an unidentified object exhibiting high magnetism that was earlier detected located at a depth of 50 to 100m.
There were no signs of life from the submarine, but family members held out hope that the massive search effort would find the vessel in time, with Ratih Wardhani, the sister of 49-year-old crewman Wisnu Subiyantoro, having said: “We are optimistic that the Nanggala can be rescued with all the crew.”
The search in the Bali Sea began near the starting position of the submarine’s last dive, where an oil slick was found, but there was no conclusive evidence so far the oil slick was from the vessel.
The navy believes the German-built submarine – which has been in service in Indonesia since 1981 – sank to a depth of 600-700m, much deeper than its collapse depth of 200m, at which water pressure would be greater than the hull could withstand.
The cause of the disappearance is still uncertain, but the navy has said an electrical failure could have left the submarine unable to execute emergency procedures to resurface.
Frank Owen, secretary of the Submarine Institute of Australia, had earlier said that the perceived oxygen deadline on Saturday morning acted as a “line in the sand” for authorities to recognise rescue efforts were “fruitless”.
“For this submarine, the only option was for it to be abandoned at the surface or for it to have found some seabed less than 180m deep so they could escape,” he told BBC Radio 4’s Today programme.
“It’s not fitted with the rescue seat to allow it to have an interface with a rescue vehicle.
“This has all the makings of a major tragedy, made all the worse by the fact it had an extra 19 people on board – probably most of them trainees because they are building up their numbers in the Indonesian navy ... so the future is even bleaker.”
Additional reporting by AP