Daniel Dudzisz, 26, went missing in February south-west of Longreach in remote Queensland as he reportedly tried to walk solo more than halfway across Australia.
Police said a motorist picked up the bedraggled tourist on Thursday near Cooper Creek outside the town of Windorah.
Dudzisz -- who is diabetic and insulin-dependent -- told police he waded through floodwaters and ate flies to survive his ordeal in the vast and wild Outback.
"If you hadn't heard it with your own ears -- and my officers have -- you certainly wouldn't believe it," Inspector Mark Henderson told the Australian Broadcasting Corporation.
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The German has been walking through New South Wales and Queensland states for several months and Henderson said local farmers had kept police informed of his whereabouts, often calling after meeting him on their properties.
"It's a very remote and isolated area with lots of hazards," Henderson told AFP, with one of them the deadly inland taipan snake which was currently "out in force" due to flooding.