The body of Navy Petty Officer First Class Park Bo-ram was discovered in the funnel of the sunken corvette Cheonan on Thursday night.
The 24-year-old sailor was among eight who remained missing after the stern of the vessel was hoisted out of the West Sea on April 15.
Divers with the Ship Salvage Unit were in the process of retrieving the severed funnel and found Park's body there, the military said. Park was wearing his combat uniform and divers were able to identify him by his name tag. The body was flown by helicopter to a Navy base in Pyeongtaek.
Meanwhile, the military said it expects the bow of the Cheonan to be raised this weekend as salvage workers managed to wrap the last two chains around the wreckage on Thursday evening.