Australian authorities have accused a Sydney father of trying to stop rescuers from saving his own family in a "horrifying" home fire that killed two boys and a baby girl.

Flames engulfed the home in western Sydney's Lalor Park in the early hours of Sunday morning while the 28-year-old man, his female partner and seven children were inside, New South Wales state police said.

Three children - two boys aged three and six, and a 10-month-old girl - were killed.

The four other children aged between four and 11 and their mother, 29, were being treated at hospital for fire-related injuries but were all expected to recover, police said.

"This is a horrifying and senseless act that has quite rightly outraged the entire state," New South Wales Premier Chris Minns said Monday.

"These children deserved a loving home with safety and security, and instead they are gone."

Police said the three deaths were being investigated as a domestic-related multiple homicide.

Prime Minister Anthony Albanese has described domestic violence in Australia as a "national crisis" following a spike in the number of violent deaths of women this year and a series of high-profile attacks.

State police said the 28-year-old man was arrested after he allegedly "frustrated" police efforts to enter the burning building.

He was in an induced coma while being treated in hospital, under police guard, they said.

"It does appear that the 28-year-old man is responsible for multiple deaths," state homicide squad commander Danny Doherty told reporters on Sunday.

The suspect allegedly acted with "the intention of keeping the kids inside the premises whilst the fire was happening," he said.