Waves of up to 2m (6.6ft) high swept through Palu on Sulawesi island.
Video on social media shows people screaming and fleeing in panic and a mosque amongst the buildings damaged.
Last month, a series of deadly earthquakes struck the Indonesian island of Lombok, with the biggest, on 5 August, killing more than 460.
Indonesia's disaster agency said at least 48 people have been killed from the latest quake but that the figure could rise.