NSW Premier Morris Iemma says a seven-year-old girl alleged to have starved to death in her bed was known to NSW's Department of Community Services.

Police say the girl was found dead at 1pm on Saturday in a home at Hawks Nest, north of Newcastle, by emergency services workers answering a triple-0 call.

A post-mortem examination has been carried out on the girl's remains.

Police would not confirm her malnourished body was found in her bed.

A 34-year-old woman was treated at the Hawks Nest home before being taken to Newcastle's Mater Hospital for observation. She was later released.

Homicide detectives have been called in to investigate, with the help of sex crime and child protection officers.

Mr Iemma said the case was disturbing and would be reviewed by the Department of Community Services as well as the NSW Ombudsman.

The coroner and NSW Police are also investigating the matter.

"The [DOCS] director-general has asked the Ombudsman to conduct an external investigation," Mr Iemma told reporters.

"I find it difficult to come to terms with a child starving to death in our community.

"We're a modern prosperous state. I know there are pockets of severe disadvantage but I shake my head that a child dies, allegedly, through starvation."

A statement from DOCS said the department had already taken action to keep the child's siblings safe.

"The death of a child is a tragedy and [DOCS] shares the extended family's grief at this sad time," the department said in a statement.

"As this matter is currently the subject of an ongoing police investigation, it would be inappropriate to comment further at this time."

Ombudsman Bruce Barbour said the external investigation into the case had already begun.

"We will pursue all necessary avenues of inquiry to ensure a thorough and proper examination of the circumstances leading to the tragic death of this child," Mr Barbour said in a statement.

Police would not say if the girl's parents had been interviewed.

AAP