It is believed the man died as a result of a fall.
The man was reported missing on Saturday night after he failed to return from his hike.
It is understood his body was found on the wreck where he was diving. "That's where he was last seen", the station officer said.
The alarm was raised when a man, who was from England, did not return to his vehicle parked near Lough Barra.
The body of a diver has been discovered off the coast of County Donegal.
The man is from England but has a house in the area and was an experienced hiker.More news: Luxoft Holding, Inc. (LXFT) Recent Ownership Changes
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The alarm was raised yesterday afternoon around 4pm when Malin Head Coastguard received a report that a diver had not returned to the surface following a deep dive.
The search on Sunday involved two helicopters, lifeboats, local dive boats and fishing vessels, as well as two dive teams.
The search continued on Saturday until 10.30pm when light faded.
Spokesman for the Lough Swilly Lifeboat, Joe Joyce, said sea conditions were hard at the time.
The missing diver, who is Canadian, was one of a group diving around wrecks in the area.