Two hours after the quake hit, however, there was no sign of the feared wave. Damage also appeared to be minimal.
The US Geological Survey said the 8.6-magnitude quake was centered 20 miles (33 kilometers) beneath the ocean floor around 269 miles (434 kilometers) from Aceh province.
"It wasn't the strongest quake I've felt," said 22-year-old Tuti Rahmi, while trying to reach her brother by phone from Banda Aceh, people around her crying and screaming as they poured from their homes.
"But it seemed to last forever," she said, adding the ground shook for nearly four minutes.
The Pacific Tsunami Warning Center in Hawaii said a tsunami watch was in effect for Indonesia, India, Sri Lanka, Australia, Myanmar, Thailand, the Maldives and other Indian Ocean islands, Malaysia, Pakistan, Somalia, Oman, Iran, Bangladesh, Kenya, South Africa and Singapore.
But hours later, the threat appeared to have passed.
Roger Musson, seismologist at the British geological survey who has studied Sumatra's fault lines, says the temblor was a strike-slip quake, not a thrust quake, which causes the sea bed to flip up.
"When I first saw this was an 8.7 near Sumatra, I was fearing the worst," he said, noting one of the initial reported magnitudes for the quake. "But as soon as I discovered what type of earthquake it was, then I felt a lot better."
The tremor was felt in Malaysia, where it caused high-rise buildings to shake for about a minute, and in Singapore, Thailand, Bangladesh and India.
There was chaos in the streets of Aceh, where memories of a 2004 tsunami that killed 170,000 people in the province alone, are still raw.
Patients poured out of hospitals, some with drips still attached to their arms. In some places, electricity was briefly cut.
Hours after the temblor, people were still standing outside their homes and offices, afraid to go back inside.
There were several strong aftershocks.
"I was in the shower on the fifth floor of my hotel," Timbang Pangaribuan told El Shinta radio from the city of Medan. "We all ran out. ... We're all standing outside now."
He said one guest was injured when he jumped from the window of his room.
Thailand's National Disaster Warning Center issued an evacuation order to residents in six provinces along the country's west coast, including the popular tourist destinations of Phuket, Krabi and Phang-Nga.
India's Tsunami Warning Center issued a warning for parts of the eastern Andaman and Nicobar islands. In Tamil Nadu in southern India, police cordoned off the beach and used loudspeakers to warn people to leave the area.
Satheesh Shenoi, director of the Indian National Center for Ocean information Services, said the chance of a tsunami was diminishing.
"There are no indications of tsunami wave; the instruments are not showing any sea level change," he said.
The quake was felt in Dhaka, Bangladesh, where many people in the city's commercial Motijheel district left their offices and homes in panic and ran into the streets. No damage or causalities were reported.
In Male, the capital of the Maldives, buildings were evacuated.
Indonesia straddles a series of fault lines that makes the vast island nation prone to volcanic and seismic activity.