Witnesses, including ABC11's Ed Crump, said the helicopter, which had pontoons attached to its landing gear, hit the ocean just off of the Yaupon Pier. They said the chopper was flying erratically and then hit hard in the water.
The aircraft was then seen floating upside down in the ocean. It was later recovered and taken to the beach.
Officials said two people who were onboard, a male pilot and a female passenger, managed to escape. The female suffered a head injury in the crash.
The Coast Guard's preliminary report said the helicopter was maneuvering 50 feet over the water when its rotor stalled.
The FAA and the National Transportation Safety Board are investigating the crash.