Neither of the men were wearing lifejackets, Police search and rescue co-ordinator Sergeant Craig Madden said.
Sergeant Madden said it was unfortunate the search ended with the loss of a life and it was imperative that anyone on the water wore a lifejacket.
Inquiries are continuing to identify the body and cause of death, Police said.
The accident happened in the upper harbour, between the Matapihi Peninsula and Welcome Bay, after the man and a friend were returning from setting nets at the Maungatapu estuary.
Senior Sergeant Rob Glencross of Tauranga Police said weather conditions were calm at the time of the accident.
Police last night scoured the shore while the Tauranga Coastguard searched the harbour, but they were unable to find the man.
A search using night vision goggles and a search light was also unable to find the man, TrustPower TECT rescue helicopter spokesman Liam Brettkelly said.
- NZ Herald Online/ Newstalk ZB / APNZ