O'Sullivan, from Cumbria, UK, but living in Auckland, had not been seen or head from for more than a week, after previously being in touch with her family daily.
Her sister Franciene Nicholson announced on Facebook that O'Sullivan had been found safe.
"We are absolutely elated that Lydia O'Sullivan has been found safe and well on an Eco retreat in the Fijian mountains," she wrote.
"My mother has just spoken to her and she is safe and well oblivious to the world search party looking for her."
The sister thanked police in Fiji and England for their "dedication" to finding O'Sullivan.
"The Fijian people have been so kind. They all went the extra mile to help find Lydia."
O'Sullivan usually messages family daily but had not been heard from since February 28.
Nicholson appealed on Facebook on Friday for help from anyone with contacts on the Pacific Island nation.
"Please could everyone share my post. My sister Lydia has not been in touch with home for 7 days now which is out of character, she's normally in contact every day," Nicholson said then.
"She was last in contact on Feb 26 when she landed in Fiji . Please, please share with any friends across the seas."
"She messaged to say she had landed safely but has not been heard of since," Nicholson wrote.
"Lydia normally contacts my mother daily. We are becoming increasingly worried as a family."
New Zealand police said at the time they had given relevant information to Fiji police to help support their inquiries.
