The 21-year-old, believed to be from Newcastle, is reported to have died on impact in the fall from her balcony.
She is understood to have returned from a night out in the famous Costa Blanca resort.
The British holidaymaker has so far not yet been named.
See also: British tourist killed after falling from Magaluf balcony
See also: Brit holidaymaker dies after falling from Benidorm balcony
She was staying at the three-star Bermudas apartment hotel with her 23-year-old boyfriend.
Local reports said both had been drinking heavily and she lost her balance and went over the balcony railing.
A relative, who was also staying at the hotel, was knocking at the apartment door at the time of the incident at around 2am on Sunday morning.
The victim fell more than 80 feet before landing on a small first-floor roof.
Police and paramedics rushed to the scene but she was pronounced dead at the scene.
An investigation has been launched into the unnamed British woman's death, which is being carried out by police under the supervision of a local judge.
At the moment it is being treated as a freak accident.
The victim is understood to have travelled to the town with her partner and family for its annual festival, which started on Friday and finishes on Wednesday.
The fiestas take place in honour of Benidorm's two patron saints - Our Lady of Suffrage and St James.
The celebrations are described as a riotous week of music, parades, fireworks and a reenactment of when the Virgin arrived in Benidorm.
The festivities date back to 1740 when a violent storm tossed a boat onto the Benidorm coast and some boys found the image of the Virgin in the charred remains of the vessel after it was burnt to prevent a possible epidemic.