HM Coastguard said the pair are believed to have become trapped as they explored HMS Scylla, which was sunk in 2004 to create an offshore reef. A major search operation off Whitsand Bay was launched after the alarm was raised on Friday evening.
A third diver managed to get to the surface and is being treated for decompression at DDRC Healthcare in Plymouth.
HM Coastguard said its helicopter from Newquay, as well as RNLI Lifeboats from Plymouth and Looe, and the police were involved in the search.
James Instance, from HM Coastguard, said: “Three people had been undertaking a dive yesterday afternoon into the early hours of yesterday evening.
“There had been an issue below surface while they were exploring the wreck.
“We were unable to locate or find anybody.
“Our thoughts are with the people who were in the dive party who are dealing with what is a very traumatic experience.”
Mr Instance added that leisure divers were being asked to stay away from the area while a recovery effort was under way.
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Mr Gardiner told the BBC: “There was a helicopter just searching round the bay here and then half an hour later we saw the boats start to come out with search lights in the pitch black.
“It’s sad, we’re sat there watching TV, going to bed, and you’ve got that feeling that someone’s in trouble or something’s happening.
“It’s not very pleasant.”