The Swedish military is checking the waters around the Stockholm archipelago after intercepting a radio transmission in Russian on an emergency frequency.
Military officials say the area is of interest to foreign powers, but did not elaborate.
The military released a photo of what appeared to be a craft surrounded by white ripples. The witness who took the photograph said the vessel then submerged.
(SOUNDBITE)(Swedish) ROYAL SWEDISH NAVY, REAR ADMIRAL ANDERS GRENSTAD SAYING:
"It could be a submarine, or a smaller submarine. It could be a diver using some form of moped-like underwater vehicle and it could be divers who don't have any business on our territory. That's where I think you have the span of what could be foreign underwater activity."
Russian officials denied any emergencies in the region involving their vessels.
Last month, Sweden said two Russian warplanes entered its air space, and called the intrusion a "serious violation".
