The teenager will appear in a local children's court on one count of murder. She remains in custody at a local police station, 24 hours after her arrest.

The teenager was found nearby the family farm, which is on the outskirts of Gunnedah, after the discovery of the 10-year-old. She was taken to Gunnedah police station for questioning.

Paramedics and police tried to revive the young girl but she died at the scene. Police said she suffered significant injuries from lacerations to her body.

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Senior police have labelled the girl's death as horrific.

The farm remains a crime scene with officers standing guard on Thursday.

A strike force has been setup to investigate the girl's death, and is being led by Oxley detectives. The State Crime Command's homicide squad was notified, but local detectives have taken charge of the case.

The location of the alleged murder cannot be reported for legal reasons, as not to identify the alleged victim's identity, or the family involved.

Australian Community Media revealed on Wednesday the alleged victim is from Orange in the Central West and was staying at the family farm in Gunnedah for the school holidays.

Investigations are continuing.

The horrific details of the case have shocked the Gunnedah community and the local council has said it will rally to help the family.

It has urged community members to reach out for help if they're are troubled by the incident.