A white Holden Rodeo ute was driving east on Barkly Street, near the intersection of Argyle Street, in West Footscray when it is thought to have hit the cyclist and a parked car after 3:00pm, police said.
The cyclist died at the scene and has not been formally identified.
Police said the driver of the ute ran on foot along Argyle Street after the crash and was last seen jumping a fence in Essex Street.
The man has been described as of Caucasian appearance, about 182 centimetres tall, with a solid build and short brown hair.
He was wearing light coloured overalls, a black T-shirt, a black long-sleeve top and white runners, police said.
Police said the man may have taken off the overalls.
Barkly Street has been blocked in both directions between Russell and Ashley streets.
Anyone with information has been urged to contact Crime Stoppers.