The single-engine light Eurocopter EC-130 belonging to PT Penerbangan Angkasa Semesta took off for the hour-long flight from Sumatra's Samosir island to Kualanamu airport in Medan city when it lost contact at 12.20 pm, transport ministry spokesman J.A. Barata told AFP.
The civil helicopter was carrying a pilot, an engineer and three passengers, he said.
"It lost contact with the air traffic control at Kualanamu about 10 minutes before it was expected to arrive. We have sent the search and rescue agency personnel to look for it," he said.
"We don't want to speculate on what might happen to the aircraft. Our priority now is to find it as soon as we can," he added.
The country has a poor aviation safety record and has suffered major disasters in recent months, including the crash of an AirAsia plane in December with the loss of 162 lives.
Ten people were killed when a domestic passenger plane crashed in the jungles on Sulawesi island early this month. Another plane crashed on a remote mountain in Oksibil Papua in August, killing all 54 people on board.