One person died and another hospitalised after their boat, which was hit by a whale, capsized in waters off Australia's Sydney city, police said.

The incident happened at  Botany Bay.

"About 6am (Saturday 30 September), Water Police responded to reports two people were in the water after an unoccupied boat was found circling in waters off Cape Banks at La Perouse,"  New South Wales Water Police said in a statement.

"Officers pulled an unconscious man from the water. Attempts to revive him were unsuccessful and the 61-year-old was declared deceased," the statement said.

A second male, aged 53, was assisted by witnesses.

He was transferred to Foreshore Road Boat Ramp and treated by NSW Ambulance paramedics, before being taken to hospital in a stable condition.

"Police have been told the 4.8m runabout vessel was likely to have struck or been impacted by a whale breaching, causing the boat to tilt, ejecting both men," the police said.

Police have started investigating the incident.