The blast was heard as far away as Bogia on the mainland, according to provincial disaster and emergency acting director Rudolf Mongallee.
Bogia lies approximately 13km south of Manam Island.
The National reported that more than 3000 people were still on the island, 2000 of which were at Baliau village and the remainder spread across the island's smaller villages.
There were 887 people evacuated last month following a notice from the Rabaul Volcanic Observatory informing disaster office officials in Madang that the Manam volcanic eruption alert had been upgraded to stage three.
According to the observatory, the activity seen from the volcano in the past few weeks will continue.