About 6pm on Saturday, emergency services were called to Diamond Beach Road, Diamond Beach, following reports a man was unconscious in the water.
Police have been told he was swimming with a large group of family and friends when he and a female friend, aged in her 20s, were swept out to deeper water by a rip.
A third male managed to rescue the woman and return her to shore.
The man was pulled from the water and witnesses commenced CPR until police and NSW Ambulance paramedics arrived. The man, believed to be aged 38, died at the scene.
Officers from Manning/Great Lakes Police District have commenced inquiries into the circumstances surrounding the incident.
A report will be prepared for the information of the Coroner.
Anyone with information about this incident is urged to contact Crime Stoppers: 1800 333 000 or https://nsw.crimestoppers.com.au.