The three men almost became meals for the sharks after they went missing while on a fishing expedition from the town of Leeman, north of Perth, sparking a big search for them involving five aircraft and five boats.
A helicopter of Channel 7 Television spotted one of the missing men, who tipped off the coastal authorities.
The rescue helicopters reached the men just in the nick of time and they found them surrounded by large hammerhead sharks.
One of the rescued men later died after been taken ashore, while the other man was being treated for injuries, ABC News reported quoting Western Australian police. The third man is still missing.
The Channel 7 helicopter which had a reporter on board dramatically relayed the rescue action live as it happened.
In images beamed live, the channel showed the men swimming almost naked with massive hammerhead sharks not more than 20 metres away, circling him.
Flying low, the helicopters dropped inflatable rescue rafts to pluck out the trapped men, just seconds from doom.