Anglesey councillor Neville Evans said he thought it had been a “very lucky escape considering how close” the crash was to a village and a caravan park.
“It’s very, very close to populations and amenities,” he said.
Another eyewitness, Pete Bennett, told North Wales Live he had watched the aircraft take off before the crash.
“I knew straight away that it was in trouble,” he said.
“On take-off there was an orange flame and as it accelerated it was basically on fire.
“As it gained altitude the flame disappeared but it was clearly in trouble.
“It climbed at an aggressive pitch. It pitched twice violently in the air and then there were two clear loud bangs.
“The pilots ejected and both parachutes opened.”
While addressing the UK Space Power Conference in London, Defence Secretary Wes Streeting gave a short update on the crash, saying both crew members had ejected.
“I’m glad to say they’ve now been taken to hospital for treatment, and of course we’re investigating how and why this happened.
“But for now, our best wishes go to the crew along with our hopes for a speedy recovery.”
First Minister Rhun ap Iorwerth said he was “very pleased and relieved” that the pilots had not been “seriously injured”.
“I wish the crew a swift recovery,” he added.
Leader of Reform UK Wales Helen Jenner said: “I grew up in Bodorgan, just along the coast from Valley.
“RAF Valley is part of the fabric of Anglesey.
“It has trained generations of fast-jet pilots, and our island is proud to be home to the men and women who serve there.”
The Senedd member for Bangor Conwy Môn said the incident has left her “deeply concerned” and her thoughts were with the crew, their families and everyone at the base.
Llinos Medi, MP for Ynys Môn, said she was “relieved both pilots were able to eject safely and that no wider injuries have been reported”.
“RAF Valley is an important part of life here on Ynys Môn and incidents such as this are felt across our community.
“My thoughts are with the pilots and all personnel at the station.”
BBC security analyst Mikey Kay described footage of the pilots ejecting being caught on camera as “quite remarkable”.
He said the pilots’ ejection seat was “one of the big lifesavers in this whole story”.
“The aircraft seat is designed for the pilot to be able to eject at zero speed and zero height, and that will allow enough time for the parachute to inflate, and then the pilots hit the ground,” he added.