The bus went through a bridge railing and fell about 30 feet into the Matamuhuri River in the Chakaria area close to the beach resort town of Cox's Bazar, Bangladesh Sangbad Sangstha reported.
"Sixteen of them died instantly and the rest one, a minor boy, succumbed to his wounds as he was being rushed to a local hospital," a police official told the national news agency.
Other passengers were injured, some critically wounded.
The police official said the passengers had been on an excursion to a religious shrine and had planned to visit the beach town before heading home.
Army troops from a nearby military base joined in the rescue operation, BSS said.