The three men were attempting to cross the McLoughlins Beach sand bar near Port Albert about 6.45am when their 5.8m aluminium vessel overturned.

They managed to set off their EPIRB (emergency positioning indicating radio beacon) which alerted authorities.

None of the men were wearing lifejackets and it's understood the Briagolong man died while the three men were clinging to their boat.

The men clung onto the boat for about an hour before attempting to swim for shore.

They initially tried to swim the deceased man's body to shore with them, but were unable to.

The two survivors, aged in their 50s, one from Woodside and the other from New South Wales, were reportedly found on the beach and were taken to Yarram Hospital suffering from hypothermia.

The Briagolong man's body was located in waters off McLoughlins Beach.

Local police, along with Gippsland water police, volunteer coast guard members from Port Welshpool, Helimed-1 and personnel from East Sale RAAF attended the incident.