Emergency services were called to the man-made beach at Castlereagh about 2.35pm today with desperate family members watching on as a search got underway.
Police used PolAir from the sky and police divers in the water to try to locate the St Marys man but instead, made the grim discovery around 6.15pm.
While the body is yet to be formally identified, it is believed to be that of the missing swimmer.
The 35-year-old man from St Marys was believed to have been paddle boarding with children when he was seen falling into the water.
Witnesses told 9News the children were pulled to safety but the man remained missing.
A full scale emergency response was initiated with police, ambulance, firefighters and two helicopters scouring the scene for any sign of the man.
Police divers and rescue boats entered the waters while green dye was used to track the current.
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”Officers attached to Nepean Police Area Command have commenced a search to locate the man, with police divers to assist,” NSW Police said.
“We were thinking it was family friendly,” one beachgoer said.
“I think there were lifeguards so I’m not sure what went wrong,” another said.
Royal Surf Lifesavers were on patrol today but 9News has been told the man was outside the official designated swim zone.
It was heralded as a much-needed relief to Western Sydney residents, who were forced to travel through multiple road tolls to enjoy the cool coastal waters on a hot day.
A report will be prepared for the coroner.