Sergeant Bryce Johnson, of Dunedin, was body boarding with his family at St Kilda about 4pm.
A woman approached and said there were people in trouble in the water.
He swam out and let the two young women, who were struggling when he arrived, hold on to his board.
The cord on his board broke during the rescue but everyone eventually reached the beach unharmed.
Sgt Johnson was thankful he had a wetsuit on, which added buoyancy and made it easier to withstand the ocean.
They had just been for their last swim of the day, after visiting beaches around the city.
They were grateful to Sgt Johnson for swimming out to help them until a rigid inflatable boat from St Kilda Surf Life Saving Club arrived to assist them back to shore.
Following their ordeal, the pair encouraged other beachgoers to swim between the flags.
St Kilda Surf Life Saving Club guard supervisor Felix Cook said it had been a big surf day.
He encouraged beach users to swim at their correct depth between the flags and to keep an eye on children.
