Police and army rescuers were sent to the area to reach survivors after part of the hillside above Sulichaur village broke away and smashed into nine houses below, police inspector Bibek Kumar Sha told AFP.
"It is still raining in the area and people are worried that another landslide will fall on the village," he added.
"We have recovered the bodies of six locals including two men, two women and two children from the site and have spotted another dead body."
The landslide injured 17 villagers, he said, and damaged shops in the settlement, which lies in the rugged highlands of Rolpa district, one of Nepal's poorest areas, 280 kilometres (175 miles) west of Kathmandu.
Hundreds of people die every year from flooding and landslides during Nepal's monsoon season, which typically starts in June and ends in September.
Copyright AFP (Agence France-Presse), 2011