"The operation is going on all night long. The people are safe on board," said Per Fjeld, a rescue centre official.
The ship was travelling south en route from Tromso to Stavanger when it got into trouble in an area that has claimed many ships.
"It is dangerous to encounter engine problems in these waters, which hide numerous reefs," Franck said.
A reception centre has been set up in a gym on shore to accommodate the evacuees, many of whom are from the US and Britain.
Another vessel had been despatched to try to tow the Viking Sky into port, potentially removing the need for the airlift.
"The boat is stable. It has dropped anchor and one of its engines is working," said a rescue centre spokesman, Borghild Eldoen.
"For the moment everything appears to be going well," added another spokesman, Einar Knutsen.
The centre said eight people had suffered minor injuries.
The area where the ship is stranded, known as Hustadvika, is notoriously difficult to navigate.
The shallow, ten nautical mile section of coastline is known for its many small islands and reefs.
"Hustadvika is one of the most notorious maritime areas that we have," Odd Roar Lange, a journalist specialising in tourism, told NRK.
In their time, the Vikings hesitated to venture into the Hustadvika, preferring instead to transport their boats by land from one fjord to another.
Operated by the Norwegian firm Viking Ocean Cruisers, the Viking Sky is a modern cruise ship launched in 2017 with a capacity of 930 passengers plus crew.
In addition to US and British nationals, there were also passengers from 14 other countries on board, Fjeld said.