The man was scuba diving with two friends near Rottnest Island, considered a popular tourist destination located about 15 miles off the mainland, when the attack occurred.
The friends, who were not in the water at the time, noticed an abnormal amount of air bubbles rise to the surface from where the man was diving followed by a plume of blood, according to police spokesman Michael Wear.
Moments later, the man's body rose to the surface, Wear said.
The man is believed to have been killed by a great white shark, authorities said after a preliminary review of the teeth marks.
"He was in the water by himself, I believe," Sgt. Greg True told CNN affiliate Channel Nine. "There's been some pretty massive injuries inflicted."
Police say the man succumbed to his injuries shortly after the attack.
The victim's name was not immediately released, pending notification of family members. He had been living in Western Australia.
Saturday's attack is the second fatal shark attack in the past two weeks near the capital of Perth.