Superintendent Greg Peters said the woman's mother and other people were inside the house at the time of the incident.
"They were all there for a Mother's Day gathering," Supt Peters told reporters.
"Unfortunately this wasn't one of those occasions where everybody will be celebrating."
After the stabbing, the three family members ran inside the house as neighbours went to the victim's aid.
The 28-year-old was known to police but Supt Peters would not say if he or others were under the influence of drugs or alcohol at the time.
The charged woman will appear in Newtown local court on Monday.
Police have seized a kitchen knife.
- AAP