The area around Mount Agung has seen hundreds of tremors and signs of magma rising to the surface in recent days.
Authorities have imposed a 12km (7.5-mile) exclusion zone around the mountain and issued their highest level alert on Friday.
The island's main tourist areas and flights remain unaffected for now.
Indonesia's national volcanology centre said in a statement (in Indonesian) on Sunday night that the mountain's "seismic energy is increasing and has the potential to erupt".
What's happening at Mt Agung?