Media descended on the usually quiet island of Awajishima, with helicopters hovering over the farmstead where the five were slain some time before 7:00 am (2200 GMT Sunday).
Police who were called to the scene found the bloodied bodies of a man and a woman, both aged around 80 years, in the main house on the site.
Two unconscious women, aged around 60 and 80 years were discovered in another building, while a badly-injured man in his 60s was found outside.
Detectives arrested unemployed Tatsuhiko Hirano, a police spokesman told AFP, with reports saying he initially admitted the multiple killing.
More From This Section
The 40-year-old Hirano lives in the area with his father and grandmother, Jiji Press reported.
Locals told the agency he rarely leaves his home and has largely been isolated from society since his school days.
The phenomenon of so-called "hikikomori" -- literally "the withdrawn" -- rears its head fairly frequently in Japan.
Often it applies to maladjusted people in their late teens or early 20s who shut themselves away for years at a time in their parents' homes, many living in darkened bedrooms with little or no human contact.