The bodies of four children and three adults were found at or near a property in Osmington near the southwestern tip of Australia, Western Australia's Commissioner of Police Chris Dawson told a news conference.

Dawson said firearms were found at the scene. He said there appeared to be gunshot wounds.

"I can only describe it as a horrific situation," Dawson said.

"We have no information to raise concern about wider public safety issues at this point in time."

Gun crime in Australia fell sharply after strict controls were introduced in response to a mass shooting in 1996, when a lone gunman killed 35 people in Tasmania.

That prompted the government to buy back or confiscate a million firearms and make it harder to buy new ones.

Australia has banned all semi-automatic rifles and all semi-automatic and pump-action shotguns, and has a restrictive system of licensing and ownership controls.

While there have been some mass killings since Port Arthur, the latest killings could prove to be the single biggest incident of gun-related deaths since 1996.

Police said they went to the property after getting a telephone call.

"The reason police went to the property was from a telephone call which we've recorded," said Dawson, who would not comment on the identity of the caller.

He said homicide detectives were helping police.