According to the James City County Fire Department, it happened around 10:45 a.m. near the mouth of the Chickahominy River.
The men were on a 28-foot commercial crabbing boat, pulling crab pots when the engine backfired.
When they went to check on it, there was a small explosion and fire.
As it started to spread towards gas cans, a fire department spokesperson says the men jumped into the water. They were able to avoid a second explosion and much larger fire.
Nearby boaters saw what happened and went to help. They pulled the men from the water and took them to the Jamestown Marina.
One of the men had burns to his face and was taken to the hospital. The other man had minor burns to his arms.
The James City County Fire Department and police responded to the fire and put it out, but it sank afterwards.
It is now in water about six feet deep.
According to the Va. Dept. of Game and Inland Fisheries, it can barely be seen above water during high tide. For now, it's been marked above the surface to warn other boaters.
The owner will be responsible for removing the boat from the river.
The cause of the fire was determined to be mechanical.