A woman has been charged with murder over the stabbing death of her mother at a house in Sydney's west.

Emergency services were called to the two-storey brick house on Pegler Avenue in South Granville about 6.15am on Thursday to reports of a stabbing, a police spokeswoman said.

It's understood Noura Khatib, 63, had been stabbed in the chest, and she was unable to be revived.

Multiple ambulance and police crews were at the scene, and police taped off a large section of the street as shocked neighbours gathered outside.

Police also taped off a nearby bus stop, and a plastic evidence bag was visible on the bench under the shelter.

Ms Khatib's 33-year-old daughter was arrested a short distance from the home.

She was taken to Granville police station, and on Thursday night was charged with murder. She is due in Parramatta Bail Court on Friday.

A large number of officers examined the crime scene, speaking to family at the home.

Detective Superintendent Matt Appleton of Cumberland Local Area Command told a news conference that several other family members were at home at the time of the attack.

The daughter was found a short distance away after she was seen by members of the public.

The Herald understands Ms Khatib is a teacher at Alfirdaus College in South Granville.

"It was a very traumatic scene for all involved this morning, particularly for the police who applied CPR," Superintendent Appleton said.

"The reasons why this occurred are matters still with investigators."

Neighbour Wiarde Taouk, who lives several doors down, said she heard screaming from a "very high" voice about 6am.

Ms Taouk and several other neighbours said they believed the daughter, who lived with her mother, had a mental illness.

Ms Taouk recalled the daughter saying of her mother: "This is the devil."

"I said to her, 'No, no, this is your mother, darling.' "