A woman has been killed and 12 people have been seriously injured after a car ploughed into a house where mourners were gathering for a funeral in far north Queensland.

Key points: Man, 55, accused of driving a car into a funeral in Cape York after a dispute

Man, 55, accused of driving a car into a funeral in Cape York after a dispute Woman, 48, dead, 12 seriously injured, dozens with minor injuries

Woman, 48, dead, 12 seriously injured, dozens with minor injuries Regional disaster management plan activated,10 people flown out

Police believe a 55-year-old man deliberately drove into the house at 10:30am in a council car, in the small Indigenous community of Kowanyama in Cape York.

Part of the house collapsed.

"As would be expected with a structural collapse, we have patients with multiple fractures and abrasions and possibly internal injuries," the Queensland Ambulance Service's Neil Noble said.

Some of the mourners were outside at the time of the crash, others were viewing the body of the deceased.

Detective Acting Inspector Mick Gooiker said the driver is related to people at the funeral.

"There is now a 55-year-old male in custody who is assisting police with their enquiries," he said.

"There are indications that there may have been some sort of dispute at the funeral.

"And this is the result of that."

A 48-year-old woman was killed and 12 people were seriously injured, with dozens more with minor injuries.

A woman injured in Kowanyama arriving in Cairns for treatment. ( ABC News )

Four people were put on emergency flights to Cairns and Townsville and another six people were taken to Cairns with lower leg injuries.

"It's terrible. I've never seen anything like it. We need help," a spokeswoman from the Kowanyama Health Clinic said.

A Kowanyama resident has told the ABC the local tavern, cafe and bakery had all been closed in an attempt to quell community unrest.

'It's going to be another World War'

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Former Young Australian of the Year and Kowanyama local, Tania Major, said her mother was at the funeral which was for her cousin.

Ms Major said her mother was in the toilet at the time.

"She just said to me 'Tania, Kowanyama is in chaos and turmoil. It's going to be another world war three zone'," Ms Major said.

"Any funeral in a community like this, the whole town would have been there.

"All I know is that all my family was there honouring my oldest cousin.

"My mum was completely shocked when she rang me. [She told me] 'you've lost another cousin'."

Disaster management plan activated

Detective Acting Inspector Mick Gooiker said the driver is related to people at the funeral. ( ABC News )

The Torres and Cape Hospital and Health Service activated its disaster management plan to respond to the casualties, with the injured to be flown to larger hospitals.

It has two doctors and four nurses on the ground at Kowanyama and a further two nurses have been sent by road from nearby Pormpuraaw.

A Royal Flying Doctor Service plane with two doctors and four nurses was also flown in to provide additional support.

Investigators and scientific officers are also expected to be flown into the community.

Investigations are underway into whether the council car was stolen.

The Indigenous community of Kowanyama, north-west of Cairns on Queensland's western Cape York in November, 2013 ( ABC News: Kirsty Nancarrow - file photo )

Premier Annastacia Palaszczuk said she was keeping an eye on the situation.

"It is a very tragic incident," she said.

"I'm going to be getting further updates during the course of the day.

"I just want to reassure the residents of Kowanyama that we are getting all the medical expertise that we can to that region."