The metre-long blade is believed to have once belonged to a Crusader knight who sailed to the Holy Land almost a millennium ago.
Shlomo Katzin came across the barnacle-covered artefact on Saturday while scuba diving in Caesarea off the Carmel coast in northern Israel, the Israel Antiquities Authority (IAA) said in a statement.
Nir Distelfeld, inspector for the IAA’s Robbery Prevention Unit, said: “The sword, which has been preserved in perfect condition, is a beautiful and rare find and evidently belonged to a crusader knight.
“It was found encrusted with marine organisms, but it’s apparently made of iron. It is exciting to encounter such a personal object, taking you 900 years back in time to a different era, with knights, armour, and swords.”
The term crusader refers to a type of soldier who took part in The Crusades - a series of religious wars directed by the Latin church in the period between 1095 to 1291. The crusaders sought to recover the Holy Land and its surrounding area from Islamic rule.
Kobi Sharvit, director of the Israel Antiquities Authority’s Marine Archaeology Unit, told the Haaretz newspaper that while Muslim soldiers used the same blade, the Ayyubids and Mamluk groups who fought the Crusaders did not arrive by sea - meaning it was more likely to have belonged to Christian fighters.
The sword is likely to have been uncovered after sand was shifted by waves, according to experts. A variety of other artefacts, including metal anchors, stone anchors and fragments of pottery, were also recovered at the site.
Mr Sharvit said the Carmel coast contains many natural coves which provided shelter for vessels during a storm. These conditions have attracted merchant ships through the ages, leaving behind "rich archaelogical finds".
He added: "The discovery of ancient finds by swimmers and leisure divers is a growing phenomenon in recent years, with the increasing popularity of such sports."
Eli Escosido, IAA’s general director, praised Mr Katzin for handing over the sword, saying: “Every ancient artifact that’s found helps us piece together the historical puzzle of the Land of Israel.
“Once the sword has been cleaned and researched in the Israel Antiquities Authority’s laboratories, we will ensure that it is displayed to the public.”