The USGS upgraded the magnitude to 6.5 from an initial reading of 6.4 and issued a yellow alert for expected fatalities and damage.
Mosques and shops were flattened in the small town of Meureudu, where the force of the quake sent people fleeing from their homes. No tsunami alert was issued.
The head of the local disaster agency, Puteh Manaf, said the sole hospital in the district had been overwhelmed by the number of injured.
"The data we have now is that 25 people have been killed and hundreds are estimated to have suffered injuries," he told AFP.
Local district secretary Iskandar Ali also confirmed the figure, citing preliminary data that showed at least 25 had died in the quake.
Rescue operations were under way to find those believed trapped beneath the rubble, with heavy machinery being used to shift the debris.
A witness said local residents were wandering the streets, unable to return to their damaged homes and fearing aftershocks.
Images from the scene showed homes levelled, mosque spires toppled and cars crushed under rubble.
"The earthquake was felt strongly and many people panicked and rushed outdoors as houses collapsed," Sutopo Nugroho of the national disaster management agency (BNPB) said in a statement, adding that few injuries, and no deaths, had been reported.
Social media images showed buildings reduced to rubble, fallen electricity poles, and people gathering outside at street corners.
District official Apriadi Achmad said that an elderly man had died, possibly from a heart attack, and there were fears for dozens believed to be trapped inside damaged homes.
"Several shophouses and homes have caved in in Pidie Jaya district and the owners are still trapped there," Achmad, chief of the local disaster management office said.
"We are now deploying heavy machines to help out and hopefully we can save the ones who are trapped," he said.
Seismologists said the earthquake was felt across much of Aceh province, which was devastated by the 2004 Indian Ocean tsunami.
At least five aftershocks followed the quake, said Eridawati, local head of the Meteorology, Climatology and Geophysics Agency.
"Some casualties and damage are possible and the impact should be relatively localised," it said, giving a 44 per cent chance of the quake resulting in between one and 10 deaths.
In the coastal town of Sigli, people panicked and fled their houses to seek shelter away from the sea.
"We are now evacuating to Tijue because we are afraid of a tsunami," said Nilawati, one of those heading several kilometres inland.
The United States Geological Survey said the quake struck at a depth of 17km on Aceh's northeastern coast. No tsunami warning was issued. At least five aftershocks were felt in the hours after the initial quake, the disaster management agency said.
The region suffered massive destruction in 2004 when a quake of magnitude 9.2 triggered a tsunami that wiped out entire communities in Indonesia and other countries around the Indian Ocean.
Indonesia was the hardest hit, with more than 120,000 people killed in Aceh alone.
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