Investigators say the damage to the 37-foot Aegean yacht appears to have been caused by a collision with a much bigger vessel, like a freighter.
The crash left three sailors dead and one missing. Two of the dead were William Reed Johnson Jr., 57, of Torrance, Calif., and Joseph Lester Stewart, 64, of Bradenton, Fla. A spokesman for the families identified the third sailor as Kevin Rudolph.
That missing sailor, identified by a relative as 49-year-old Theo Mavromatis of Redondo Beach, is presumed dead, authorities said. Mavromatis and Stewart were brother-in-laws.
The U.S. Coast Guard, the Mexican navy and civilian vessels scoured the waters off the shore of both countries for Mavromatis before suspending their search Sunday evening.
The Newport Ocean Sailing Association, the race organizer, said the crash occurred late Friday or early Saturday several miles off the coast near the California-Mexico border. Authorities on Sunday recovered parts of the yacht.
The yacht was reported missing on Saturday during the 124-mile Newport to Ensenada International Yacht Race.
"They were all good, there was nobody that didn't know what they were doing or where to be all the time," said Michael Patton, a friend of the victims. "That's why I'm blown away that something like this happened. I can't imagine."
Patton said he would have been on board with the experienced sailors, but called Mavromatis at the last minute to cancel after his mother fell ill.
The race passes through shipping lanes used by larger freighters, but Patton says there was equipment and warning systems on the Aegean that should have kept everyone safe.
"It shouldn't have happened," Patton said. "I'm at a loss to understand that. We ran all precautions and radar and all that stuff. It's beyond me."
The Newport Beach Patch website posted a photo that shows the crew at the start of the race. Four men in royal blue T-shirts are on the deck as the boat cuts through calm waters. One man is waving and another appears to be smiling.
A total of 210 boats were registered in the annual yacht race, according to the Newport Ocean Sailing Association's website. The race started off Newport Beach on Friday and many boats finished in Ensenada on Saturday, with the last ones due in Sunday.
Race officials said these fatalities are the first in the 65-year history of the event.
The deaths follow another fatal yacht crash earlier this month near San Francisco has led to races being halted in that area.
Five crew members died when their vessel was hit by waves. Racing organizers have suspended racing in the San Francisco area until a new review of safety procedures can be completed.
The Associated Press contributed to this report.