At around 2am on Friday morning, police responded to a call from a neighbour about a loud scuffle taking place outside.
Outside the building, police found the 16-year-old and an 18-year-old with stab wounds.
Both were taken to the central hospital in Västerås.
“Around seven the 16-year-old died from his injuries. We don’t know exactly what the fight was about. That will come out following future questioning,” said Västmanland police spokesperson Börje Strömberg to the TT news agency.
The 18-year-old, who has yet to be questioned, is being held on suspicions of homicide and manslaughter.
The teenagers were related to one another. The 18-year-old lives in Hallstahammar, while the 16-year-old resided about 40 kilometres south in Eskilstuna.
“We know about the older relative, but he hasn’t committed any serious offences,” said Strömberg.