Douglas Co. Sheriff's Office says a utility worker spotted Byrne's body in a snow bank along route from the Snow Globe Festival to a hotel.
Byrne, 19, was with friends attending a music festival in South Lake Tahoe before she vanished. She was last seen shortly after midnight on New Year's Eve at the Horizon Casino Resort in Stateline, Nev.
Sheriff's deputies are now trying to trace newly discovered activity made with Byrne's cellphone after she disappeared.
Douglas County investigators confirmed Thursday that either a call or text was placed from her phone after midnight. Investigators had originally believed that the last activity on her cellphone was made before midnight.
But, investigators cautioned, the activity does not mean that the phone was in Byrne's possession.
Byrne was attending the Snow Globe Music Festival on New Year's Eve, but she left the party and took a shuttle back to the hotel. Investigators said they have a credible eyewitness who talked to her in the casino. No one had seen her since. Byrne's friends looked for her but went home with her things when it was time to check out of the hotel.
A Twitter user by the name of "@alyssa_byrne1" posted on New Year's Eve: "After tonight, you'll never be a part of my life." Another tweet by the same user said, "Just lost all my trust in the person I trusted most."
"We've seen those and there's still a debate as to the actual author of those tweets," Douglas County Undersheriff Paul Howell said.
Teams of investigators are looking through hours of surveillance tape from the casino -- a job that could take days and may not produce any leads.
In Petaluma, friends and family from far and wide have gathered under the same roof to support the Byrne family.