In a tragic final post to Instagram, McDermott showed himself singing in the cancer ward of Prince of Wales Hospital in Sydney with other patients, joking: "Cancer can't get us, we're too happy".
Fans flocked to the post on Saturday, writing "rest easy you legend", and "you were the best".
McDermott spent 20 years working as a lifeguard on the Central Coast and 10 years patrolling the famous Bondi Beach.
Co-star Trent Maxwell shared his own tribute, thanking McDermott for his "wisdom".
In addition to several seasons on Network Ten's hit reality show, Bondi Rescue, McDermott also starred in the spin-off series, Bondi Rescue: Bali.
Co-star Trent Maxwell also shared a moving tribute to McDermott, thanking him for "teaching me the ropes of lifeguarding".
"I will miss you mate, never a dull moment," he wrote. "You were a great waterman and always had some great wisdom to share to the young blokes. We had some great times together you will be missed."
According to Sunshine Coast Lifeguards, he died on September 1 surrounded by family and friends after a battle with cancer.
"Terry was a charismatic, articulate character who always had a wonderful story to tell," the group shared on Facebook.
"He was a friend and colleague to many lifeguards around the country and, in fact, well known all over the world.
