Seven people were killed in a bizarre religious ritual in a jungle community in Panama, including a pregnant woman and five of her children who were tortured, beaten, burned and hacked with machetes.

Key points: The religious sect was holding several families against their will in a local church

The religious sect was holding several families against their will in a local church The ritual was "aimed at killing them if they did not repent their sins"

The ritual was "aimed at killing them if they did not repent their sins" A pregnant mother and her five children and their 17-year-old neighbour were among the dead

Officials found the bodies of the six and the child of one of their neighbours in a mass grave in the indigenous region of Ngabe-Bugle, said Rafael Baloyes, senior prosecutor of the Bocas del Toro province of western Panama.

In a video published by the office of Panama's Attorney-General, Mr Baloyes said the grave came to light after locals who had managed to escape the religious sect alerted authorities about the ritual.

They said several families were being held against their will in a local indigenous-run church, where exorcisms were believed to have taken place.

Police subsequently freed 15 people who were being held by the cult, and who had been tied up and beaten with wooden cudgels and Bibles.

Ten sect members were arrested on suspicion of responsibility for the killings, prosecutors said.

Mr Baloyes said police were prepared for something bad after they received the warning, but were still surprised by what they discovered at the ranch where the little-known religious sect known as "The New Light of God" was operating.

"They were performing a ritual inside … there were people being held against their will, being mistreated," Mr Baloyes said.

"All of these rites were aimed at killing them if they did not repent their sins," he said.

"There was a naked person, a woman," inside the building, where investigators found machetes, knives and a ritually sacrificed goat, he said.

Police arrested 10 people connected to the sect on suspicion of being responsible for the killings. ( Ministerio Publico Panama )

About 2 kilometres away from the church building, authorities found a freshly dug grave with the corpses of six children and one adult.

The dead included five children as young as a year old, their pregnant mother and a 17-year-old female neighbour.

"They searched this family out to hold a ritual and they massacred them, mistreated them, killed practically the whole family," Mr Baloyes said.

He added that one of the suspects in the killing is the grandfather of the children who were slain.

All the victims, and apparently all the suspects, were members of Panama's largest indigenous group Ngab Bugl, a community that suffers from high rates of poverty and illiteracy.

Ricardo Miranda, leader of the Ngab Bugl semi-autonomous zone known as a Comarca, called the sect "satanic" and said it went against the region's Christian beliefs.

AP/Reuters