The 35-year-old was fishing alone off Innisfail, south of Cairns in Queensland state, and was reported missing on Sunday evening when the boat and floating speargun, which was pierced through a fish, were discovered.
An aerial and water search was launched with a body retrieved on Monday morning.
"Initial investigations suggest the man may have been taken by a crocodile," Queensland police said, adding that they believe it was a four-metre beast.
"Wildlife officers from the Department of Environment and Heritage Protection are targeting the crocodile for removal."
The Cairns Post reported an aggressive crocodile, thought to be the same one, attacked a police boat late on Sunday in what Inspector Rhys Newton said was indicative of behaviour when the reptile has killed recently or is protecting a food source.
It was the second blow in a month to the local spearfishing community after a man recently had his leg ripped off by a shark at nearby Hinchinbrook Island, the newspaper said.
The latest tragedy came only a day after a teenager escaped the jaws of a crocodile by punching it in the head during a late night swim in a river close to Innisfail.
The 18-year-old suffered extensive injuries to his left arm after being dared to jump in by his friends.
Australia is home to freshwater and saltwater crocodiles with the more feared "salties" growing up to seven metres long.
Saltwater crocodile numbers have exploded since they were declared a protected species in 1971, with recent attacks reigniting debate about controlling them.
They kill an average of two people each year in Australia.