The Cessna 206 hit the ground and burst into flames shortly after take-off on Saturday at Caboolture Airport, north of Brisbane.
The pilot, two skydiving instructors and two skydiving customers were killed, police said.
Family members witnessed the crash from the ground, they said.
The flight was operated by Adrenalin Skydivers Bribie, also known as Skydive Bribie Island, a spokesman told the Sydney Morning Herald, which carried pictures of the crash site.
“We received a call from the airfield and sent three crews to a light plane that had crashed,” a Queensland Fire and Rescue Service official told Agence France-Presse.
Caboolture is about 31 miles north of Brisbane.
The airport was closed after the crash.
The Sydney Morning Herald says the airport has only grass strips and operates gliders, helicopters and light aircraft.
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