The woman’s body was first spotted floating in the water off Hunter St, Dover Heights, about 2.15pm by a member of the public.
Water Police later found the woman, believed to be aged in her 20s, about 100m off shore.
At this stage, the woman has not been formally identified.
Water Police and emergency services were yesterday involved in the hunt for a man who vanished in rough surf conditions off nearby Bondi Beach.
They were unable to find any trace of the man who was last seen standing on rocks at the southern end of the beach.