SÃO PAULO—Rescue workers raced Friday to find around 200 people feared buried under mud in southeastern Brazil after a dam belonging to miner Vale burst, engulfing homes, cars, and the company’s own local offices.

Brazil’s Vale, the world’s largest iron ore producer, said the majority of victims were the company’s employees, adding that it had only accounted for 100 of the estimated 300 workers at the site so far. Authorities said they had recovered seven bodies as of Friday evening.