Police confirmed a 28-year-old woman died, another man, 31, remained in Christchurch Hospital in a serious condition.
Ilam Lifecare manager Maurice David confirmed the woman was one of his employees.
"She has been working with us for a couple of years, she is working in the support services team."
He described her as "well-liked" and said staff had been affected by the loss of a colleague.
"At the moment there is an important focus on the staff, support mechanism are in place."
"Our heart goes out to the family."
Police responded to the incident and arrived at the scene shortly before 7.50pm.
The deceased woman and a man had allegedly been stabbed by a second man.
That man had then allegedly turned the knife on himself.
Ilam resident Tony Rotherham said he heard a commotion outside his house on Rudleigh Ave about 20 minutes before the incident as he was watching television.
"I had heard a profound amount of yelling for roughly 10 minutes before the incident had supposedly happened but I thought it was no more unusual than what we hear from drunk people on a regular Saturday night.
"After hearing the sirens I went outside to check if everything was okay.
"That's when I was informed by an officer that a domestic disturbance had occurred."
It wasn't until later he read about the "unsettling incident".
He said it has sounded like yelling at first but only after learning what had actually
happened did it occur to him it "sounded different than you would typically expect".
It was something he did not expect in a community like Ilam.
Detective Senior Sergeant Scott Anderson said although the investigation was still in its early days, those involved were known to each other and police were not seeking anyone else.
The incident occurred on Ilam Rd and the area will remain cordoned off until further notice.
The incident unfolded near the Ilam Seventh-day Adventist Church.
