Four people have been forced to leap from a sinking yacht onto a rope ladder hanging from a merchant ship in a dramatic rescue off the north coast of New South Wales.

The crew of the 15-metre yacht called for help as their boat was battered by wild weather about 3:00am.

They had been battling three-metre swells and strong winds about 19 kilometres off Evans Head, south-east of Lismore.

The Northern Region Rescue helicopter was called out, but the crew members were collected by a nearby merchant ship.

Helicopter crewman Mark Sewell said the rescue was a harrowing experience for those involved.

"The way they got off, they put down a rope ladder and one at a time with a safety line they scaled the rope ladder," Mr Sewell said.

"It's just a matter of timing it to jump onto the ladder and climb on board.

"Where it was unfolding it was quite rough, probably a good two to three metre swell, the wind we're estimating [was] close to 30 knots out there.

"It was quite rough and I'm sure quite scary for those persons, especially until the daylight broke through."