The storm in the East China Sea was heading northwest at a slow speed with gusts of 222 km/h, the Japan Meteorological Agency said.
It was projected to change direction to move east towards the country's mainland, but its path was not determined, public broadcaster NHK said.
Two people were reported dead in Okinawa, a popular tourist destination some 1600 km southwest of Japan's capital Tokyo, as of Thursday morning, NHK said.
A total of 41 people in Okinawa and Kagoshima prefectures were injured, the Fire and Disaster Management Agency said.
Naha Airport, located in Okinawa's capital city and the main gateway to the popular tourist destination, resumed operations on Thursday after shutting down for two days. Still, 304 flights were cancelled, the transport ministry said.
Local utility Okinawa Electric Power Co said 160,040 households, or about a quarter of all houses covered, were experiencing power outages on Thursday morning local time.
In addition, power supply was down for about 6550 households in Amami islands in Kagoshima prefecture, north of Okinawa .
Typhoon Khanun also forced schools and businesses to shut in northern Taiwan on Thursday, with nearly 40 international flights being cancelled.
