The fire at Fero's Bar & Grill was reported around closing time at 2 a.m., Police Chief Robert White said.
Firefighters found four women and one man dead inside the bar. Police don't think they died in the fire.
"The business has obviously been set on fire, an arson, I'm guessing, to mask the homicide that occurred inside," said police Commander Ronald Saunier.
"There is just trauma, enough information to believe that we have a homicide that occurred here. They didn't perish in the fire," he said.
The fire didn't appear to be a very large one. No damage to the bar was visible from the street or aerial news coverage.
The bar is located in a strip mall about five miles south of downtown Denver just outside of the tony Cherry Creek North shopping district on one of the city's busiest streets, Colorado Boulevard. In listings in Denver's alternative weekly, Westword, Fero's is described as a "longstanding dive" that attracts regulars as well as people staying in nearby hotels. It shares the strip mall with a check cashing store and a car repair shop.
The bar's owners couldn't immediately be reached for comment. No one answered the door at the Aurora home of Young Fero, listed in state records as one of the owners of the bar. A sign on the door read, "Day sleeper, please don't ring the doorbell! Thank you." It was signed "The sleeper."
Neighbor Mike Spinale described Fero as "really nice."
"She didn't speak much, but I know she owned a bar and she worked all the time," Spinale said. "She told me she did everything herself."
After sunrise, residents in a neighboring apartment building were out walking their dogs as police looked in trash bins and checked out cars parked outside.
The five dead are believed to be the only ones in the bar when the fire started - other than whoever is responsible for their deaths -so police are asking anyone else who was at the place earlier to come forward, as investigators try to piece together what happened.
The victims haven't been identified. Autopsies were expected to be conducted later in the day.
Frank Peluso, who works in an office building a half block away, said he used to eat lunch at the bar but hasn't been there in three years. He said it seemed to be declining and the owners have tried various things to attract more business, including offering karaoke.
"It's one of those places that you wonder how it stays in business," Peluso said.
Resident Matthew Neam said you can't see into the bar because the front windows are frosted. He said he and his friend used to joke about what might be inside.
"I've never gone in there. It always looked kind of sketchy to me," Neam said.
