The deceased was one of three workers who became trapped at the Auburn factory shortly before 9am this morning.
New South Ambulance superintendent Paul Turner said the worker had been trapped by his legs, describing the area as 'a very difficult scene'.
'There was still ink on the floor of the vat, which hampered rescue efforts and treatment,' he told Daily Mail Australia. 'It’s extremely hot inside the vat.'
Three men, all aged in their twenties, were initially all conscious and talking when they were trapped about 8.45am on Thursday.
However, Mr Turner said the deceased men 'deteriorated rapidly towards the end'.
Ten ambulances responded to the scene, along with Police and Fire and Rescue trucks.
The two rescued men were taken to Westmead Hospital, with one man suffering suspected leg injuries and the other leg fractures.
Ambulance parademics at the scene told reporters the injuries were likely to have been caused by falling into the vat instead of the chemicals inside.