Officials from the Department of Foreign Affairs and Trade made contact with the Australian, who is in Tibet, on Tuesday morning.
It brings the official number of Australians missing in the flood-stricken region down from 43 to 42.
"It's hard to imagine the sense of relief their loved ones must be feeling after what will have been an incredibly harrowing few days," Foreign Affairs Minister Penny Wong said in a statement.
The individual, who is yet to be identified, is the second missing Australian to be found safe after 26-year-old trekker Cara Severino made contact with her family over the weekend.
"Despite this second piece of welcome news in recent days, we must remain realistic about the days ahead," Senator Wong said.
"Our thoughts remain firmly with all those waiting for news of family and friends, and with the search and rescue teams working in extraordinarily difficult circumstances."
The family of missing NSW south coast man Michael Keats announced his death in the floods on Monday.
The 37-year-old's grieving partner and her young son are raising funds for a spiritual grieving trip to India to honour his memory, a verified GoFundMe post said.
DFAT said it has not had any official confirmation of Australian deaths in the region.
A massive mudslide and flood hit Nepal's border with China on August 26, killing more than 1000 people and leaving 4400 people missing, including 592 foreign nationals.
An Australian Air Force C-17A full of Australian aid pallets is expected depart Brisbane early on Tuesday carrying humanitarian supplies, equipment and personnel to support communities devastated by the floods.
Australia has sent an 18-person response team and pledged millions in aid, including hygiene kits and solar lights.
Rescue crews near the Tibetan Plateau are desperately battling the clock in the search for survivors among the rubble, as mass burials begin.
Nepali rescuers have built temporary bridges to reach remote areas and dug through the ruins of hydropower projects in the Himalayas to rescue close to 300 trapped workers, Reuters reports.
About 600 people remain stuck in several devastated hydropower stations that have become the focus of rescue efforts.
Australian tunnelling expert Arnold Dix is remotely assisting with the rescue mission, and is hopeful more people will be found alive.
"The best place to be, not to be killed, would have been in one of our tunnels - so if they survived that, they can be alive in there for a long period of time," Professor Dix told Nine's Today program on Tuesday.
"If people want to be alive and they've got access to water, they can do it for weeks - we've got time on our side but of course we want to get there quickly."
The rescue efforts are ramping up as hundreds of Nepali and Tibetan diaspora, along with members of the wider community, united at a candlelight vigil at Melbourne's Federation Square on Monday evening, five days on from the disaster.
Buddhist monks and Hindu priests chanted sacred mantras as community members young and old laid electric candles and said prayers at a mural at the foot of the stage.
''Behind every missing person is a family living through unbearable, uncertainty, hoping for a phone call, reunion, or a final answer,'' Victoria United for Nepal's Nirajan Gauli told the crowd.
Many of the Australians missing were completing the Kailash Mansarovar Yatra - a spiritual journey significant across several religions including Hinduism and Buddhism.
Among the Australians still missing are four members of the Iyer family, Sreedharan, Lakshmi and their sons, Rudra and Rishabh.
Sydney IT worker Gopi Krishna Naidu Agastya, Royal Australian Air Force member Karan Bhardwaj, Sydney woman Sumi Adhikari and Sunshine Coast woman Renee Spry have also been confirmed among the Australians missing in the tragedy.
Mr Agastya, 45, had completed the pilgrimage with spiritual tour company the Isha Foundation alongside a large group including 10 other Australians.
The Parramatta man was clearing immigration at the Gyirong port on the Nepal-China border en route back to Kathmandu when the powerful flood hit, his friend Murthy Yeluru told AAP.
"It was a dream of his to visit this Mansarovar, it's a very rare opportunity," Mr Yeluru said.
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