The Yakhont anti-ship missile was launched on Wednesday from the Van Speijk class frigate, Oswald Siahaan, during naval exercises in the Indian Ocean. Russian observers oversaw the drills, which involved 12 ships and over 1,000 personnel.
It took six minutes for the missile to cover 250 nautical miles and destroy a designated target.
"The target ship was hit [by the missile] and sank," Navy spokesman Rear Admiral Iskandar Sitompul said. "We bought these missiles a long time ago, and have finally tested them."
Indonesia bought an undisclosed number of Russian SS-N-26 Yakhont supersonic anti-ship cruise missiles for $1.2-million apiece in 2007 to replace Harpoon missiles on its frigates.
The missile has a maximum range of 300 kilometers when cruising at high altitude. It flies at low level during the terminal phase, and between 5 and 15 meters in altitude.