South Sudan's military on Monday raised to as many as 40 the death toll from a "friendly fire" incident last week in which it sank one of its own river boats at night.

"The final death toll is between 37 and 40" from the incident last Wednesday in which the army fired at the boat transporting soldiers on the River Nile, military spokesman Philip Aguer told AFP.

Tensions remain high around border areas with Sudan, South Sudan's former civil war foe, and the boat was mistaken for an enemy craft in an area where rebel groups, which the South claims are backed by Khartoum, operate.

Aguer said the army had launched an investigation into the "unfortunate accident" involving a boat that was carrying some 170 soldiers from Melut toward Malakal, in South Sudan's Upper Nile state.

He said the ship's crew had not communicated clearly with South Sudan's army, the SPLA, about its movements.

"The boat left late, there was no information passed to the (river) station ahead, and the SPLA have orders not to travel after 6:00 pm, and to pull in at the nearest station to wait for daylight", he said.

"The commander of the force made a big mistake," Aguer said, adding that he was among those killed.

Aguer said soldiers onshore fired warning shots when the boat failed to stop at a river checkpoint in Lul, and that troops onboard returned fire.

"People in Lul were suspicious and when they fired a warning shot, they (the troops aboard the vessel) fired back," he said.

"Those at the station fired an RPG (rocket propelled grenade) and then things on the boat got very bad" as the vessel tilted and sank, he said.

"Most of the dead bodies are from the drowning, not bullets", he said of the 27 bodies pulled from the water, with at least 10 more presumed dead.

"Just like any other army in the world, we are taking this matter very seriously and investigating," Aguer said. "This is a serious mistake."