The 18-year-old, who was on holiday with his family and a friend, flew out of the green-coloured, twisting ride on Monday at the Terra Mitica, or Mythical Land, amusement park, police said.
"We received a call at 4:45 pm because an 18-year-old man, who was Icelandic, apparently because of a fault in the seat's harness, was thrown out," said a source at Alicante provincial police station.
"He hit the ground and died shortly afterwards in the ambulance," the source told AFP.
Police said the seat's harness opened but it was unclear if the cause was a mechanical fault. The ride had been closed during police investigations.
The victim has not been named.
Terra Mitica management issued a statement saying the rollercoaster had been officially certified as safe and it was checked daily by amusement park staff.
"For the moment the cause of the accident is unknown," management said.
"Terra Mitica will carry on investigating the cause of this most unfortunate incident," the park said, stressing that it had enjoyed a spotless safety record for the previous 14 years.
"Terra Mitica management offer all their support to the family," the statement said.
A spokeswoman for the regional Valencia High Court said an investigating judge was awaiting a police report within the next few days before deciding on further action to discover what happened.
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