Madalyn Davis, a 21-year-old beautician from Lincoln fell in Diamond Bay Reserve on the coast east of Sydney.
Her body was pulled from the water four hours after emergency services were called on Sunday.
New South Wales Police said that while the circumstances were being established, her death would be “treated as suspicious”.
“Misadventure has not been ruled out,” the force added.
Madalyn said on social media last month that she was “super excited for my future abroad”.
According to the Sydney Morning Herald, she had been in Australia for a few weeks and had been at a party in Vaucluse on Saturday night.
She is believed to have been among a group of people who went to the nearby clifftops to watch the sunrise.
Friends on social media expressed their shock and grief at the news.
“RIP to one of the most beautiful, inspiring and funny people I had the pleasure to call my friend,” one wrote, while another said it was “heartbreaking news”.
Another said: “Less than 2 hours before this happened we was partying and having the time of our lives living our dreams in Australia.”
They added: “Absolute joy to party with, someone who brought smiles and laughter to everything we did.”
Posting on Instagram on 13 December, Madalyn wrote: “Can’t believe I’ve been travelling for a whole month now!
“Not looked back at my old life once (miss my job though) and I am super excited for my future abroad.”