A 44-year-old woman died in the incident on Kennedy Quay, near Cork city centre, shortly after 8pm on Friday evening. Two children, aged 10 and 11, managed to escape from the vehicle before it sank.
Gardaí said they are treating the matter as a tragic accident, with a report on the matter set to be compiled for the Cork City Coroner.
Both youngsters were dragged to safety by shocked onlookers after managing to swim to the quayside.
Minutes later, the car containing the driver sank.
The dead woman has been named locally as Gillian Daly (44), who lived in the Douglas area.
It is understood the woman and the children had been in a city restaurant for a meal in the hours before the incident.
Both children were given preliminary medical treatment at the scene and were later taken to Cork University Hospital (CUH) for precautionary medical assessment of non-life threatening injuries.
They were treated for shock but were expected to be discharged into the care of a family member. Both will be brought to their south city home to recover.
The car sank minutes after entering the water. Ms Daly, who was the driver, was trapped in the vehicle as it sank.
A huge search and recovery operation was launched involving members of An Garda Síochána, Cork Fire Brigade, HSE paramedics, the Coast Guard, Naval Service, Cork River Rescue, and Mallow Search and Rescue.
The operation was coordinated by the Coast Guard’s Sikorsky Rescue 117 helicopter which hovered overhead to use its specialist search cameras.
The incident occurred shortly after 8pm when high tide had almost reached its peak at the upper quays.
After an assessment of the scene, Naval Service divers were able to enter the water shortly after 10pm.
They were able to locate the body of the woman and it was successfully recovered from the water.
Her remains were transferred to the city morgue at CUH where a post-mortem examination was scheduled to be conducted yesterday.
It is believed she drowned.
Gardaí are checking reports that the vehicle stopped on the quay moments before the tragedy, before suddenly jolting into the river. Officers are also investigating reports the vehicle may have toppled over the open quay while reversing.
A full examination of the car involved will be conducted by a Public Service Vehicle (PSV) expert. Gardaí will also study CCTV footage from around the area to determine the precise movements of the vehicle in the minutes leading up to the accident.
Eye-witness statements, including the accounts of the two children, will prove crucial in unravelling the minutes leading up to the tragedy.
Detectives have appealed for anyone who witnessed the incident or who was in the area at the time and may have vehicles equipped with dash-cam footage, to contact them.