The Tunisian coast guard says at least three would-be immigrants to Italy drowned when their boat sank off Sidi Daoud, a small town in the Cap Bon region. Rescue teams have pulled 35 survivors from the water, and are scouring the Mediterranean for more.
Libya, thought to be a starting point for many Italy-bound boats, says it is willing to cooperate to prevent illegal immigration, but not at the expense of its sovereignty.
The sinking of the vessel packed with illegal immigrants on Sunday marks the third such disaster off North African shores this month.
Diplomats say most of the hopeful immigrants embark on the final leg of their attempt to reach Europe from Tunisia's eastern neighbor, Libya. Italy's government is calling for Libya to help stop the influx and has offered to send naval units to help patrol the Libyan coast.
But Libya's Foreign Minister Abdel Rahman Shalqam says such support will not be welcome. In no way would Libya allow a foreign force to patrol its ports, as Italy has requested. He said the proposal by Italian Prime Minister Silvio Berlusconi was not even up for negotiation.
Italy, which takes over the revolving presidency of the European Union for the next six months, says nearly 100 illegal immigrants find their way to its southern shores every day, mostly from North Africa.
Illegal immigration has become a heated issue in Italy, with some politicians saying the country should send navy warships out to sink the incoming, often rickety, and overcrowded boats.
Italy has said that in return for effective cooperation from Libya, it would press for a relaxation of a European Union ban on arms sales to Libya.
Libyan Leader Muamar Qaddafi, while offering to do everything possible to help stem the flow of illegal immigrants through his country, has said the only real solution to the problem is more economic aid to provide jobs and economic incentives for poor Africans to stay at home.