The navy said the craft crashed into the Pacific Ocean as it was travelling to meet the aircraft carrier USS Ronald Reagan.
How the crash happened was not yet clear, while the names of those aboard were being withheld.
Eight people have been rescued and transferred to the ship, the US 7th Fleet said in a tweet. They are "in good condition". Both Japanese and US teams are looking for the remaining three, it said.
The aircraft was taking part in a joint Japan-US naval exercise that is due to end on 26 November. It crashed about 90 miles northwest of the Okinotorishima atoll and the navy said it would investigate the circumstances.
It happened during what the navy described as the "premier training event" for the two forces, designed to increase defensive readiness and interoperability in air and sea operations.
The Reagan was operating in the Philippine Sea when the crash took place, at about 2.45pm local time. The eight personnel on board were picked up some 40 minutes later.
8 personnel recovered following C2-A crash have been transferred to #USSRonaldReagan for medical evaluation and are in good condition. Search and rescue efforts for three personnel continue with @USNavy and #JMSDF ships and aircraft on scene. https://t.co/uuIWd9SUSF pic.twitter.com/rvFC81Qbqq— 7th Fleet (@US7thFleet) November 22, 2017
A propeller powered transport plane, the C-2 Greyhound carries personnel, mail and other cargo from mainland bases to carriers operating at sea.
The type has been in operation for more than five decades and is due to be replaced by the long-range tilt-rotor Osprey aircraft.
The 7th Fleet has had two fatal accidents in Asian waters this year, leaving 17 sailors dead and prompting the removal of eight top Navy officers from their posts, including the 7th Fleet commander.
The USS John S McCain and an oil tanker collided near Singapore in August, leaving 10 US sailors dead. Seven sailors died in June when the USS Fitzgerald and a container ship collided off Japan.
Additional reporting by agencies