The five men dived into the Bogey Hole and swam to where it appeared the gold cross thrown by Father Nicholas Scordilis from the cliff above had splashed.
After an initial furious search they surfaced and looked to onlookers above who provided tips.
A second later Payton Tagaroulias emerged holding the cross the aloft.
"I actually kicked it with my foot by accident. That's the only reason I knew where it was," Mr Tagaroulias, 28, said.
The Newcastle Greek Orthodox Blessing of the Waters Ceremony is now in its 63rd year.
Tradition dictates that the person who finds the cross is bestowed with good luck for 40 days.
"It was nice to be part of it and win it and also to do it with a couple of my cousins," Mr Tagaroulias said.
Father Scordilis said this year's event was dedicated to those affected by the bushfire crisis.
"We remember the victims but also the fire fighters who are working tirelessly to save lives and property," he said.