The Austria Press Agency said that a 35-year-old woman fatally shot her mother (59), her brother (40) and her three children aged seven to 10, before apparently killing herself.
The crime took place in a house in the settlement of Schildberg, near the town of Böheimkirchen, situated 55 kilometres (34 miles) to the west of the city of Vienna.
The family's dog had also been shot.
It's not clear exactly when the murders happened, but according to the Krone newspaper the children had not been in school for several days.
"The alert was raised by the employer of one of the victims, because the person had not gone to work for some time," said Michaela Schnell, a spokeswoman for the prosecutor's office.
The building in which the family lived used to be an inn, with some rooms which were rented out.
The death of six people including three children from the same Austrian family is being treated as a domestic shooting, prosecutors said Thursday after police found the bodies.
After the restaurant closed, three generations of the same family had moved in, but kept to themselves and were not very sociable, according to a neighbour.
Another neighbour told the Krone newspaper that the family appeared to be normal and that he had never seen them fighting. The family was known to have little or no contacts with the local church.
The suspected murder weapon, a pistol, was found in the house near on of the bodies.
Police told AFP investigations were ongoing. Crime scene investigators finished their work at 6 p.m. on Thursday. The district prosecutor has ordered autopsies for the bodies.