The ship's hull was pierced and at least one fuel tank began leaking into the nearby Cap Corse and Agriate marine reserve created just two years ago.
An estimated 40 to 200 cubic metres (1,400 to 7,000 cubic feet) has spread into the park, authorities said.
Both France and Italy have sent two boats to the site, where an inflatable boom has been deployed to stop the spread of a slick which now stretches some 20 kilometres (12 miles).
Another boat from each country is expected to join them soon.
"Pushed by the wind, the spill has spread and is breaking up", a spokesman for maritime authorities said Monday.
It was not immediately clear if fuel was still leaking from the Cyprus-based CLS Virginia, and officials were still evaluating how to separate the two ships and bring them to port.
Writing on Twitter, Corsica leader Gilles Simeoni said he was determined to find what caused the accident, which occurred in relatively calm seas with good visibility.
He also called for "absolute vigilance in preventing eventual pollution, especially since the collision occurred within the Cap Corse and Agriate marine reserve."
The wind was pushing the spill toward the northwest away from the French island which is known for its pristine waters and tourist beaches.
French Environment Minister Francois de Rugy was on his way to the site Monday afternoon, his office said.
The accident occurred early Sunday when a Tunisian freighter rammed into a Cyprus-based vessel that was anchored about 30 kilometres (20 miles) off the northern tip of the French island.
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