Kyle Chalmers' grandparents celebrate his gold medal swim

In their humble lounge room at home in South Australia, Malcolm and Julie Bagnell screamed and cried as their grandson Kyle Chalmers swam into the history books today.

The 18-year-old put exams on hold to compete at the Rio Olympics and was an outside medal contender in the 100m freestyle final.

But as the schoolboy surged from seventh place to steal gold in the final moments, Mr and Mrs Bagnell had tears in their eyes as they watched their television in disbelief at home in Port Lincoln, west of Adelaide.

"It's gold, it's gold," Mr Bagnell bellowed as he jumped from his seat, smacking his wife on the lips as she held her hand to her mouth in shock.

Later, Mr Bagnell, who is usually "settled" when he watches his grandson compete, said he was "amazingly proud" of the Rio triumph.

The victory was also equally as enjoyed by Chalmers' classmates at Immanuel College in Adelaide who packed together in front of a TV to watch.

The wall of sound from the school was deafening, with classmates screaming and clapping in sheer exhilaration.

Chalmers is the first Australian man to win the 100m freestyle since 1968.

"It's unbelievable, I'm only 18," Chalmers said.

He and his classmates will sit their end-of-year exams from the start of October.

The race was a shock disappointment for favourite Cameron McEvoy, who ended up finishing seventh.

But McEvoy was very quick to embrace his younger compatriot and sing his praises in a post-swim interview.

"He's just turned 18, bloody wonderful isn't it?" McEvoy said.

Australia's medal tally now stands at five gold, two silvers and five bronze.