The girl, who is thought to have been unharmed in the shooting, was found by police at around midnight inside a bullet-riddled British-registered BMW.
She was found hiding beneath two dead women in the back of the vehicle and lay undiscovered as police waited for a forensics team to arrive.
A man, named as Saad El Hilli from Claygate, Surrey, was also found dead in the front drivers' seat of the vehicle and a second girl - believed to be around seven-years-old - was found critically injured on the road near to the people carrier.
A male cyclist, named locally as Sylvain Mollier, was found dead close to the car - he had also suffered gunshot wounds.
He is reported to have worked for a firm based some miles away and was identified after his wife - who was concerned that he did not return from his cycle ride - reported him missing to police.
Public prosecutor Eric Maillaud said the four-year-old girl was "terrorised, immobile, in the midst of the bodies".
He said: "As soon as the first forensics began, we were able to open the vehicle, and it was at that moment we discovered the little girl, around four years old, that nobody had seen, because she hadn't moved, completely in shock and completely frozen."
Maillaud said that 15 cartridges were found around the car indicating that a "very large number" of shots had been fired.
The weapon used is thought to have been an automatic pistol.
The BMW people carrier was found yesterday on the outskirts of a forest in a car park in the popular tourist region around Lake Annecy - the second largest lake in France.
French officials said the BMW was registered to a UK national who was staying at a nearby campsite, believed to be Le Solitaire du Lac in the Saint-Jorioz area.
Eric Maillaud said the man checked into the site with two women and two young girls, adding: "The owner of the vehicle was British and he was the person who identified himself to the campsite.
He is presumed to be a victim and was accompanied by two women and two little girls. We can assume it's a family, although it is yet to be proved.
"We have been taking evidence, including DNA, which will be sent to the British authorities for confirmation."
Doctors now say the seven-year-old girl injured in the shooting is out of danger. She was taken to nearby Grenoble University Hospital where her condition has reportedly stabilised following emergency surgery.
"We don't know when we will be able to question her and I would imagine she is in a state of shock," Mr Maillaud said.
Police are as yet unsure whether one or more gunman was involved in the shooting, although one theory is that the shots could have been fired during a bungled robbery.
The Foreign Office (FCO) said today that it was in contact with the French authorities and seeking further information.
An FCO spokesman said: "We are aware of the reports of the shooting and we are looking into these urgently."
He added that British consular staff had arrived in Grenoble this morning.
The Foreign Office said that the British Embassy's deputy head of mission in France was also at the scene of the shooting.
"She is liaising with the local authorities and police to get more information," a spokesman said.
Didier Berthollet, mayor of Chevaline, said the area did not usually have problems with crime.
"We are most surprised by what happened, it is a very quiet village," he told BBC News.
"It's very popular for all who want to be in a peaceful area."