The father of missing hiker Lily Hooper cracked a beer and was celebrating after being mistakenly told his daughter had been found alive.

Minutes later, Jim Hooper and Lily’s mum, Kirrily, were pulled aside and told of the devastating communication mix-up — that their daughter was actually dead.

The Daily Telegraph reports he slumped into a chair and buried his head in his hands, while his wife broke down crying.

Media cameras were at the command post on Thursday when the traumatic bungle unfolded, capturing the shift from elation to heartache.

Earlier, Hooper had punched the air in triumph after NSW Police officers told him his daughter had been found.

“Lily is alive, my girl is alive, she’s coming home, she’s coming home,” he told The Daily Telegraph.

“I knew something was going to happen today, she’s a tough kid.

“They’re going to get her now … she’d be going straight to hospital I’d say.

“I’ve been beside myself for the last eight days … I’ve just been told minutes ago … they found her.”

His wife Kirrily, 50, chimed in: “It’s taken a bit of time but they’ve found her, she’s alive. I am over the moon.”

But about ten minutes later, Lily’s inconsolable loved ones were hunched over in sudden grief.

Lily Hooper’s supporters hug each other after the bad news. Photo: 7NEWS

Police and the emergency service will review their communications protocols after the tragic mix-up.

NSW Police Commissioner Mal Lanyon apologised for the “embarrassment and confusion” caused by the miscommunication that had turned “elation” into “deflation”.

He committed the force to a review of the communications failure alongside the State Emergency Service.

“I’ve spoken to the Commissioner of the SES. Together, we will look at the communication, obviously with a view to improving that,” he said.

“This is not a circumstance I would like to see repeated.

“Communication is always a challenge, and in remote areas, from time to time, it can be challenging to get the right communication through.

“We want to make sure it’s as simple and accurate as possible.”

He apologised for any “additional trauma” caused to the family, who had expressed their relief to media while believing Hooper to be alive.

The miscommunication wound its way through police ranks to the NSW premier on Thursday, he additionally revealed.

Chris Minns had expressed relief at mistaken reports of Hooper’s survival during a parliamentary hearing before having to rescind his statements.

Lanyon said the message “would have gone through police commands”.

“The normal process it goes through a range of police commands to the Minister for Police, and then to the Premier’s Office,” he said.

The NSW premier later issued a statement apologising to the family.

“I genuinely believed I was sharing good news,” Minns said.

“I am profoundly sorry to think anything I said may have added to their heartbreak at an already devastating time.”

Hooper disappeared on August 12 after leaving her home to go on a hike.

The teenager from Oakdale, in Sydney’s southwest, did not return that evening and could not be contacted on her mobile phone, triggering a wide-scale search.

Nearly 1000 searchers scoured the dense Nattai National Park for signs of 18-year-old Lily Hooper over eight days before a volunteer found her body on Thursday morning.

Her car was discovered at the Bonnum Pic trail head the same night she went missing, but earlier on Thursday Assistant Commissioner Joseph Cassar said the teenager was found a long way from her vehicle.

“I can’t give you the exact distance but … it wasn’t on a clear, walkable track,” he said.

“It’s thick, dense bush and a lot of it is steep cliff area.”

-with AAP