Hundreds of stupid, drunk and drugged partygoers danced millimetres from death at an "underground" dance party held at the base of a seaside cliff in Sydney's east, police say.

The rave, which started at midnight on the tennis court-sized, oceanside rock platform, 30 metres below the Clovelly cliff top, was shut down by police responding to noise complaints at 3am (AEDT).

Heavy surf pounded around the party, with waves washing at times onto the dance "floor" lit with strobing coloured lights powered by a generator that also powered the music.