Buffett departed St. Vincent's Hospital in inner Sydney via a back entrance to avoid the media after doctors gave him the all-clear on Thursday morning, Ten Network television reported.
Medical staff said the singer had suffered a head injury, but added he was in good spirits and lucky to have recovered so quickly from the fall at Hordern Pavilion on Wednesday night.
Witnesses attending his show described hearing a "crack" as Buffett's head hit the floor following an encore performance of his song "Lovely Cruise."
"He really took a very nasty tumble," the hospital's emergency department director Gordian Fulde, who attended the concert, told Seven Network television.
"He just didn't see the drop in front of the stage," Fulde said.
"I heard the 'crack' and I thought: 'This guy has broken his neck,"' he added.
Fulde, who is also a surgeon, rushed to the aid of the 64-year-old entertainer.
"He had a head injury and he lost consciousness ... (but) scans show that he's OK," Fulde told Seven Network.
Buffett lay on the floor in front of the first row of seating waiting for paramedics and an ambulance to arrive, and he was rushed to hospital half an hour later.
The Margaritaville singer had performed on Sunday and Monday to sold-out crowds at Sydney's Opera House, and the Wednesday concert was tacked on in response to demand.
"We've had an unfortunate incident, but the show's over so if you could move along that would be very, very cool, thank you," the audience was told after the accident.
A message posted on Buffett's website said he was doing well.
"As you probably already know, Jimmy had an accident while performing in Sydney last night and was taken to the hospital," the statement said.
"The doctors say he is doing well ... More info as we get it, and thank you for all of your well-wishes!"
Buffett and the Coral Reefer Band had not performed in Australia for 20 years, The Daily Telegraph said, and had promised to return in 2012.