Crews have been scouring Port Phillip Bay for any sign of TV camera operator James Rose, 30, and pilot Stephen Gale, 56, after their Jetworks Aviation flight went down about 1.45pm on Sunday.
Victoria Police on Tuesday morning confirmed crews found a large part of the body of the plane off the shore of Mornington.
Police will search the fuselage after it is removed from the water.
Investigators were still working to determine the exact circumstances of the mid-air crash and believed the aircraft would have been visible from Mount Martha between 1pm and 2pm on Sunday.
Officers urged anyone who saw the planes to come forward.
View this post on Instagram A post shared by James Rose (@rose_james_rose) TV cameraman James Rose is presumed dead after a plane crash
Mr Gale, a highly experienced flyer from Brunswick, owned Jetworks Aviation.
The plane was one of two Viper S-211 Marchetti aircraft conducting a formation flight for a Jetworks Aviation promotional video about 12km west of Mount Martha.
They collided mid-air and one crashed into the water while the second landed safely at Essendon Airport with two people - including off-duty Qantas captain Joanne Mein - on board.
It is understood Ms Mein was in the rear seat of the second aircraft and wasn't flying the jet.
A Qantas spokeswoman said the company was deeply upset to hear about the incident at Port Phillip Bay.
"The news has shocked the Qantas and Jetstar pilot communities and everyone's thoughts are with these families," the spokeswoman said.
"We've reached out to those involved and are providing whatever support we can."
With hours passing and no sign of the aircraft wreckage, the rescue mission shifted on Monday to a recovery mission with the two men presumed dead.
The Australian Transport Safety Bureau was planning to interview the surviving pilot of the second plane on Monday afternoon.
Jetworks Aviation, based at Essendon Fields, hosts flight training and joy rides, with one package offering a 45-minute two-jet fighter formation flight.
Selfie from my back seat. — Stephen Gale (@StephenGale201) #s211jet pic.twitter.com/oQ9xajZR9wOctober 25, 2022 Pilot Stephen Gale owned Jetworks Aviation
The business was created for the TV documentary Any Fool Can Fly, which is yet to air, according to the show's website.
The series was set to show a "group of high achievers" attempting to master flying, aerobatics and formation, with Australian comedian Tommy Little among the "student pilots" featured.
Rose, a well-known and experienced drone operator who lived in Surrey Hills, has worked on high-profile TV shows for the Nine and Seven Networks and production company EndemolShine, including on cooking show MasterChef.
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