The Coast Guard and Federal Aviation Administration reported that passengers in a Hilo-bound Aloha Airlines jet spotted the two people in a yellow life raft minutes after the ditching.
The pilot is believed to be Kenneth Landau, of Oakland, Calif. The identity of his passenger, also believed to be a pilot, was not immediately known.
Landau had left Hilo at 5:47 a.m. and ran into trouble about 85 miles northeast of Hilo. He was returning to Hilo when one of the two engines failed.
Jerry Judd, FAA spokesman, said Aloha flight 404, which had taken off from Honolulu Airport at 6:25 a.m. for the 50-minute flight to the Big Island, was then vectored to the area to accompany or help find the downed Piper.
Judd said Landau ditched his plane at 7:07 a.m. about 28 miles northeast of Hilo.
Ronie Cabison, a Wahiawa construction worker, was sitting on the right side of the Aloha jet just above its wing when pilot Bob Bryant told the passengers to help in the search.
"Keep your eyes open," Cabison said were Bryant's instructions. "We circled couple of times when I saw two persons in a life raft."
Attorney Anthony Locricchio, who was sitting five rows behind Cabison, said Bryant broke off his search pattern after he was sure the search and rescue aircraft had spotted the survivors.
Locricchio said the downed pilot had released a green dye which marked the crash area.
Bryant said "it was a good job by everyone involved," citing help from traffic controllers, his flight crew and his passengers.
Tom Yoneyama, Aloha spokesman, said the interisland jet remained in the search area for nearly 30 minutes and didn't leave until the Coast Guard arrived on the scene. The jet landed in Hilo at 7:45 a.m.
The Coast Guard dispatched a C-130 airplane and helicopter from Barbers Point Naval Air Station and the cutter Kiska from Hilo. Also on the scene was Hilo Fire Department's helicopter.
The crew of the Coast Guard C-130 dropped a radio to the men on the raft, and they reported no major injuries.
After being in the water for more than two hours, the pair was plucked by the Coast Guard's H-65 helicopter at 9:14 a.m. and flown to Hilo Airport. They refused medical treatment and were released, according to Hilo authorities.
The aircraft, which could be configured to carry six to 10 passengers, is registered to Paragon Air Inc. in Kahului, Maui.
Eric Barto, head of Paragon, said his company has owned the aircraft for three years and was planning to sell it.
"It was in perfect condition. The plane had been well maintained and we never had any problems with it. ... I am curious to find out what happened."
He said Paragon had hired Brent International to ferry the airplane to the mainland to be sold.
He didn't know the identity of the other pilot.
The plane had been taken to Honolulu two weeks ago, and all the seats were taken out and replaced with fuel tanks to prepare it for the transpacific flight.