A 1995 expedition reported finding the Empress upside down in 500ft of water.
The salvagers broke into the ship's strong room only to find a single skeleton -- but no gold.
Now a survey by a Marine Robotics Team from the University of Limerick (UL), using a "Smart" remotely operated vehicle (ROV), has discovered the ship is actually on its side.
The Empress of Britain was hit by two bombs from a Luftwaffe Condor on October 26, 1940 and caught fire about 70 miles northwest of Aran Island, Co Donegal.
Most of the 578 survivors were picked up by British ships, while the liner continued under tow to the Clyde in Scotland.
However, a German submarine, the U-32, shadowed the salvage convoy for nearly 24 hours before firing three torpedoes.
Two hit and sank the Empress northwest of Bloody Foreland. Some 25 crew members and 20 passengers were killed when she went down.
The gold is now thought to have been taken off the ship while it was on fire and its passengers were being evacuated.