The early morning closure of Ngurah Rai airport sparked the cancellation of nearly 450 flights to and from the tropical paradise.
Mount Agung shot a tower of smoke and ash some 2,000 metres (6,500 feet) into the sky Thursday evening.
The airport was closed early Friday after a pilot flying overhead detected traces of volcanic ash as high as 23,000 feet.
Ash is dangerous for planes as it makes runways slippery and can be sucked into their engines.
Bali’s main international gateway will be closed until at least Friday evening, according to officials, who added that two other domestic airports were also shut.
The fresh activity threatens to create travel chaos after an Agung eruption in November stranded thousands and pounded Bali’s lucrative tourism industry and wider economy.
Tens of thousands of locals fled to evacuation centres after last year’s eruption.
The volcano is about 75 kilometres from Bali’s tourist hub in Kuta.
Australian visitor Rod Bird came early to the airport only to be told his flight back to Perth had been cancelled for the second time.
An earlier flight on AirAsia was called off before the airport was shuttered early Friday morning.
“They told us the volcano is going off so they rebooked us for this morning and we got here at 5:00 am only to be turned away again. So we’ve had two cancelled flights,” Bird told AFP.
“Well it’s Bali, these things happen and we are fine with it. We just miss the kids,” he added.
Some 446 domestic and international flights have been cancelled after the volcano roared backed to life, affecting about 75,000 passengers.
Thousands were stranded at the airport or hotels Friday, but it was not immediately clear how many tourists were unable to leave the island.
Despite the eruption, Agung’s status remained on alert status, the second highest danger warning.
There is a four-kilometre (2.5 mile) no-go zone around Agung’s peak.
Bali’s governor appealed for calm, and said activity at the crater has declined significantly since Thursday evening.
“We will try our best to find a solution so all visitors can continue their trip,” Made Mangku Pastika said.
Agung has been erupting periodically since it rumbled back to life last year.
Its last major eruption in 1963 killed around 1,600 people.
Indonesia is the world’s most active volcanic region and lies on the Pacific “Ring of Fire” where tectonic plates collide, causing frequent volcanic and seismic activities. DM