At least 303 cases of unauthorised access were confirmed between late May and June 14, including three that involved cash trades resulting in financial loss, a Line spokesman told AFP, without providing further details.
"We are cooperating with police in investigating the cases, and we are calling for users to change passwords," the spokesman said.
The accounts were hacked "presumably after shared passwords with other online services were leaked somewhere else," he said, adding that to the company's knowledge, all of the breaches occurred in Japan.
A police spokesman said the case was under investigation.
Set up in 2011, LINE now has more than 400 million users, mainly in Japan and mainland Asia, and is growing fast.
The service lets users make free calls, send instant messages and post funny photos or short videos, combining attributes from Facebook, Skype and messaging application WhatsApp.
LINE has forged heavyweight partnerships with football clubs FC Barcelona and Real Madrid, brands such as Coca-Cola and tennis star Rafael Nadal.
FC Barcelona, for instance, has a home page on the app which has millions of "friends".
One of Line's main selling points is its "stickers" -- funny, cartoon-like figures that users can post to friends.