Ram Bahadur Banjan, who is 16, disappeared on Saturday from a forest where he had meditated for the last ten months during which, his followers insist, he has consumed no food or water.
Local official Santaraj Subedi said police, followers and family members were looking for the boy who is popularly known as the "Little Buddha", in the jungles of Bara, about 100 miles south of the capital, Katmandu.
Gautam Raj Kattel, a police officer, said some people claimed that they had seen Ram heading south on foot before dawn on Saturday. The boy's clothes were found near where he had been meditating.
He had been sitting cross-legged and motionless with his eyes closed in a niche among the roots of a tree in the jungle since 17 May, 2005. His friends previously said that Ram was planning to carry on meditating for another six years until he gains enlightenment.
Despite some scepticism, the feat has been attracting thousands of people to see him every day. Ram has become something of a tourist attraction and local people set up stalls to sell things to the visitors. Booklets and CDs about him have been selling well across Nepal.
Following his disappearance, supporters said they believed he may have decided to go further into the forest to look for somewhere quieter.
The boy's followers have refused to allow independent monitoring of his health, saying this would only disturb him, and the Nepalese authorities decided not to intervene in case this upset local people.
Before he vanished, villagers said Ram had been growing weaker. His hair had grown long and almost completely covered his eyes, which he kept closed.
The boy's mother reportedly fainted when she found out her son was on a long-term fast and was planning to meditate for such a long time.
But the hype surrounding him has been fuelled by her name - Maya Devi Tamang - as she has the same first name as Buddha's mother.
According to Buddhism, Ram would not be a reincarnation of any previous Buddha, because once someone reaches true enlightenment to become one, they are never reincarnated.
On 8 November last year, Ram stood up and said to his followers: "Tell the people not to call me a Buddha. I don't have the Buddha's energy."
The area where he is meditating is known to have substantial numbers of communist rebels who have been fighting government troops for a decade, and there were fears that he may have been kidnapped.
However, Mr Kattel said he doubted that Ram had been abducted either by the rebels or local criminals, and he believed the boy had just wandered off.
Many followers believe Ram is a reincarnation of Gautama Siddhartha, who was born in Nepal in about 500 BC and after his enlightenment became revered as the Buddha.
Visitors have been allowed to view Ram only between dawn and dusk from a roped-off area about 80ft away.
Buddhist priests who visited him said the boy was not the incarnation of Buddha, but added that they believed he had been meditating for months.
Buddhism teaches that right thinking and self-control can enable people to achieve nirvana - a divine state of peace and release from desire.