Paramedics attempted to resuscitate Australian Surf Life Saving Championships competitor Saxon Bird on Kurrawa Beach and continued CPR while he was transported to Gold Coast Hospital by ambulance.
But he died in hospital on Friday afternoon, officials said.
The teenager's surf ski washed onto the beach around 11.30am (AEST) on Friday during the under-19 ironman event.
After an air and sea search of a one kilometre section of the beach Bird was located by a fellow life saver less than an hour later.
The championships has been suspended and a decision will be made by Saturday morning on whether they continue.
A strong rip is running along the water's edge about 10 metres out from the sand, with waves between 1.5 and two metres.
Organisers deemed conditions at Kurrawa safe enough to go ahead with the event on Friday, despite two people being injured in rough conditions at the surf carnival this week.
Cyclone Ului is whipping up rough conditions along the Queensland coast.
Bird, from Denistone, in Sydney's northwest, was representing the Queenscliff Surf Life Saving Club.
He was a member of the NSW surf life saving high performance team and has taken a number of national titles over the past four years.
Robert Gatenby, 15, a member of Kurrawa's under-18 boat crew, drowned at the 1996 nationals at the same beach, as Cyclone Beti ravaged the Queensland coast.
The boardwalk fronting the surf clubhouse is named in his honour.