The incident took place last night in southern Kandal province when a driver boarded a local ferry at what investigators said was an unsafe speed.
"The driver had drunk two cans of beer... he drove the car too fast onto a ferry and it fell into the water," a police report said.
The group had been returning from worshiping at a relative's grave for the annual Qingming festival -- also known as Tomb Sweeping Day -- the report added.
The driver managed to escape out the window but the rest of his passengers, including children aged between four and 13-years-old, died. The driver has since been arrested.
Three other people who were part of the group had exited the vehicle before it boarded the ferry, police said. Impoverished Cambodia has a poor health and safety record with road and industrial accidents commonplace.
Ferries are often used to transport cars and motorbikes over wide rivers in the tropical nation. As in China and many other East Asian countries, Qingming festival is widely celebrated across Cambodia's various communities.
During the festival people visit and clean the graves of their ancestors as a mark of respect and to make merit.