A man has been arrested after a scuba diver was struck and killed by a speed boat on Port Phillip Bay.

A 41-year-old man from Carrum Downs in Melbourne's south-east got in touch with police on Monday, and was arrested shortly after in Mordialloc.

He is currently assisting police with their inquiries and has not been charged.

It comes as police revealed the diver who died was using a buoy and flag to ensure he was visible while underwater.

Two men in their 20s were spearfishing a few hundred metres out in Canadian Bay off Mount Eliza about 1pm on Sunday when one was hit by a boat.