Dan McGarry, a journalist who lives in Port Vila, said police at Villa Central Hospital told him that one person had died.
McGarry said he saw three people “seriously injured” on hospital gurneys awaiting treatment. The earthquake was “the biggest I’ve seen in 20-plus years,” he added.
Footage on social media shows collapsed buildings, cars smashed by fallen panels and furniture strewn across the floors of homes. Residents report uneven communications.
According to photos posted online, the US Embassy in Port Vila is among the damaged buildings.
U.S. officials said the building sustained “significant damage” and will be closed until further notice.
“Our thoughts are with all those affected by this earthquake, and the US government will work closely with our partners in Vanuatu,” the Papua New Guinea embassy said in a statement.
Michael Thompson, director of the Vanuatu Jungle Zipline adventure company, told AFP he saw bodies lying in the streets.
“Several buildings collapsed in the city. A major rescue operation is now underway to free people who may be alive in the building,” Mr Thompson said in a separate video posted on Facebook.
“Most communications are gone.”
The USGS reported at least four aftershocks around Port Vila – ranging in magnitude from 4.7 to 5.5 – in the two hours after the first quake.
Authorities in neighboring New Zealand and Australia said there was no tsunami threat to their countries.
Australia also said it was “ready to support Vanuatu as the extent of the damage is assessed”.
“Vanuatu is a family and we will always be there in times of need,” Foreign Affairs Minister Penny Wong wrote on X.
Vanuatu, a low-lying archipelago of about 80 islands, is located in a seismically active zone and is prone to frequent strong earthquakes and other natural disasters.
