Emergency services were called to the Double Tree Hotel by Hilton in the Far North Queensland city at 1.50am on Monday.
Queensland Ambulance confirmed a helicopter crashed into the roof of the hotel - with between 300 to 400 people evacuated from the premises.
The pilot, a man aged in his 40s, was killed while two people who were staying in one of the rooms were rushed to hospital to be treated for smoke inhalation.
The helicopter was part of the fleet of Nautilus Aviation, one of Australia's premier helicopter operators, which said the use of the chopper was unauthorised.
'Nautilus Aviation are working closely with Queensland Police, the Australian Transport Safety Bureau and other authorities as they investigate the unauthorised use of one of our helicopters in the early hours of this morning.
'As we continue to fully support the ongoing investigation, we will not be making further comments at this time.'
Meanwhile, a well-placed source told Daily Mail Australia that the helicopter may have been stolen.
None of the accredited pilots who work for Nautilus Aviation were flying the aircraft. 'All the pilots have been accounted for,' the source said.
MNA/PR