Emergency services were called at 10.15am after the man lost control of his vehicle on State Highway 87, the vehicle plunging about 20m off a steep bank next to Lee Stream bridge, leaving a trail of car parts in its wake.
Sergeant Kevin Davidson, of Mosgiel, said he "definitely'' expected the man, who was in his mid-60s, to be dead when he saw the mangled state of his Ford Focus next to Lee Stream.
"It should have been a fatal. I've never seen a car damaged like that - taken off from that vantage point before - where the driver has survived.''
The car travelled about 50m after leaving the road before coming to rest in some willows on the opposite side of the stream.
Police were investigating the cause of the accident, but it appeared the man lost control of his vehicle as he was taking a corner coming down the hill leading to the bridge.
The fact he was wearing a seatbelt would have played a part in his survival.
Snr Sgt Davidson also praised the skills of the Otago Regional Rescue Helicopter pilot, who had to carry out an "intricate manoeuvre'' to avoid a power line.
Firefighters using the jaws of life cut the man free from the vehicle just before 11.15am.
A St John spokesman said the Dunedin man, who was airlifted to Dunedin Hospital after being cut from the car, was "very lucky'' to have escaped with only minor injuries.
