Volunteers on board Marine Rescue NSW found the 64-year-old spear fisherman about 9am this morning off Lennards Island near Eden.
The man was first reported missing about 3.15pm yesterday when he failed to return to shore after entering the water.
Marine Rescue NSW crew resumed the search about 8am this morning after it was called off 5.40pm last night due to poor light.
NSW Water Police, rescue helicopters and the Marine Rescue NSW vessel XRAY 30 and Merimbula 31 were all used during the multi-agency search.
Marine Rescue NSW Inspector Glenn Sullivan said it was a wonderful outcome.
“It was an amazing effort from all rescuers involved in this search which began yesterday afternoon,” he said.
Eden is a town in the the South Coast region of New South Wales, about 478 kilometres south of Sydney.