Witnesses who were either working or passing the day at the Fun Zone, a park with carnival-like attractions on the Balboa Peninsula, said the explosion took them off guard.
It was so powerful, they said, that they could feel the ground shake beneath them.
"It was a pretty loud explosion," said Michael Gutierrez, who was working at the Newport Landing Sportfishing right across from the dock where the boat caught fire. "You could feel the building shake. I went out there and everything was sort of rumbling around."
Anna Romo, who also works at the sportfishing store, said at first she thought it was the Pirate Boat, a tourist attraction that gives rides in the harbor and replicates the sound of a cannon.
"But then we looked out and we saw a bunch of smoke coming at the end of fuel dock," she said. "Then I saw a lot of people starting to crowd around, and that's when I thought, 'OK, something bad has happened.'"
A woman was taken away in a stretcher and had burns on her legs, Romo said.
According to Von Rettberg, the fuse in the boat built up in the engine compartment and ended up "blowing the cover off the engine."
An employee at the fuel dock said as soon as the boat caught fire, he got the passengers out, in accordance with the company's policy, then pushed it into the harbor.
"It wasn't that big a deal," said an employee who identified himself only as Wes.