Airlines have been issued with a red warning and scores of flights have been cancelled since the eruption began at 5.30pm local time yesterday.
The stunning yet terrifying spectacle has been caught on camera as a huge black plume of ash continues to stream out of the volcano.
Photographer Emilio Kuzma-Floyd, who lives in Bali, shared incredible footage of Mount Agung erupting as the sun rose over Bali this morning.
He tweeted: “As it happens, #mountagung erupting at sunrise with #mountbatur in the foreground. Can’t describe the feeling of seeing such an uncontrollable force of nature unfolding.”
Overnight a red glow of what appeared to be magma could be seen at the top of the Bali volcano, which was shrouded in darkness.

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Indonesia’s National Disaster Management Agency (BNBP) spokesman Sutopo Purwo Nugroho shared an image of fiery red smoke was pouring out of Bali volcano at 11pm local time on Friday.
He said that that lava was now coming out of the crater of Mount Agung, adding: “Since last night the type of eruption is magmatic that continues until now.”
Ash has also rained down on villages surrounding the volcano, leaving a grey dusting on cars, roads and buildings. Officials collected samples of the ash last night.
People were seen gazing at the erupting volcano in awe and putting on masks to protect themselves from volcanic ash.
Meanwhile, tourists have been stranded at Ngurah Rai International airpot, while Lombok island’s airport will remain closed until at least 6 am on Monday.
Australia’s Bureau of Meteorology’s Volcanic Ash Advisory Centre (VACC) in Darwin issued maps showing an ash cloud heading southeast over the neighbouring island of Lombok, away from Bali’s capital, Denpasar, where the main international airport is located.
Agung rises majestically over eastern Bali at a height of just over 3,000 metres. When it last erupted in 1963 it killed more than 1,000 people and razed several villages.