Two men had to be winched to safety after a 70-ft yacht sank 20 miles north of the Isles of Scilly.
The coastguard received a distress call from the vessel at 05:18 GMT on Monday morning.
It was taking on water and unable to pump it out due to an "electrical issue" while travelling back to Ireland from Ramsgate after a refit.
Coastguard Tago Mcleod said local ships were asked to help, and the rescue helicopter was scrambled from Newquay.
The uninjured crew were found on a life raft, shortly before the vessel sank.
The helicopter and crew arrived back on land by 06:15.