Northland police Search and Rescue coordinated the search which, as well as private boats, involved the Northland Rescue Helicopter and an Air Force Orion from Whenuapai.
The man was spotted about 9.15am on Sunday, none the worse for his night on the rocks, by another charter boat.
Far North Radio and Sea Rescue president Annette Hall said the response from boaties in the area was immediate.
The diver was picked up ''miles away'' from where he entered the water and transferred to another charter boat, whose crew landed a striped marlin as they were heading back to Whangaroa Harbour.
After the stress of the previous night the catch sparked wild celebrations on board.
''The guy who was rescued was leaping around, having the time of his life. At that moment all the stress melted away.''
The fishers put their success down to the rescued diver, deeming him their lucky charm.
Detective Sergeant Paul Overton, of Northland police Search and Rescue, said the rescue helicopter searched the area for several hours on Saturday until it was stood down due to failing light.
A P-3K2 Orion joined the search at 7am on Sunday. Police were preparing to send up the National Dive Squad from Wellington and the Defence Force was readying the HMNZS Manawanui for use as a dive platform when the man was found.
Police had serious concerns he could have been washed out to sea by powerful currents in the area.
Given the islands' remoteness it was lucky there were four boats in the area.
The operation was greatly assisted by the Defence Force and Far North Radio, Overton said.
''She [Annette Hall] alerted us to the incident in the first place, she did a great job. Annette's contacts and the community up there were also a wealth of knowledge about the conditions up there.''
The Princes Islands are a cluster of seven small islets west of the Three Kings' biggest island, Manawatāwhi.
