Videos of Saturday’s incident showed tourists shouting as a column of rock came crashing down, smashing several leisure boats and sending a huge wave over the lake at Capitolio in Minas Gerais state.
Rescue teams including a dive squad and members of the Brazilian Navy rushed to Furnas Lake.
The latest official toll is “seven dead and three missing”, said Pedro Aihara, the spokesman for Minas Gerais firefighters.
Another 32 were wounded, including nine who had to be hospitalised, authorities said.
The people hurt in the accident had broken bones and one was in serious condition in hospital with head and facial injuries.
Furnas Lake, which was created in 1958 for the installation of a hydroelectric plant, is a popular tourist attraction in the area roughly 420 kilometres (260 miles) north of Sao Paulo.
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