It is believed 24-year-old student Kristi Kafcaloudis was on a group tour with about 30 others when she asked someone to take a photograph of her standing on the edge of the rock.
She lost her balance while posing for a photo and plummeted between 200m and 300m to the bottom of the gorge.
Norwegian news broadcaster NRK said a search team hiked for hours up steep terrain to reach her body, which was then flown to Odda Hospital.
The Trolltunga is a piece of rock jutting out of a mountainside, 700m above the north side of Lake Ringedalsvatnet.
It is a popular spot for tourists and has been voted one of the most impressive places on the planet to take a photograph.
Ms Kafcaloudis was studying a double arts science degree at Monash university’s Clayton campus in Melbourne and was on exchange at the university of Bergen in Norway, where it is believed she studied music and cultural science.
Kristi, who had only arrived the month before, was originally from the Sunshine Coast hamlet of Yandina.
Her friend Freddie Wright said Ms Kafcaloudis, who had travelled to Norway only in recent months to spend the second university semester abroad, had a wonderful sense of humour.
The university’s rector, Dag Rune Olsen, described Ms Kafcaloudis’ death as a “tragic fatality” and offered support to other students.
“It is with great sadness that we learn that one of our international students has died,” he said.
“Rector and university management were informed by the police of the tragic accident at Trolltunga in Odda, Western Norway, on Sunday morning 6 September, that Australian exchange student Kristi Kafcaloudis had died after a fall.
“We have assisted police with necessary information, and we work with the local government and the Student Welfare Organisation in Bergen.”
Professor Olsen said the university was working with student priests in Bergen and that an assembly with information from police had been arranged for Ms Kafcaloudis’ friends.
A Monash spokesman said the university communiversityty was saddened by the news of Ms Kafcaloudis’ death.
“Our deepest sympathies are extended to her family, her colleagues and friends during this tragic time,” the spokesman said.
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