The plane lost contact after taking off from Pokhara - a resort town west of Kathmandu.
Officials said it was heading north to Jomsom which is the starting point for trekkers going into the mountains.
Rescue helicopters have been deployed to search for the Twin Otter aircraft, which is operated by Tara Air.
No trace of the plane has been reported so far, according to one Pokhara airport official.
Most passengers are believed to be Nepalese, with no British citizens thought to have been on board.
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