Homicide Squad detectives and police remained at the scene early Saturday morning.
A 32-year-old Cranbourne man was arrested in Dandenong about 2.30pm on Saturday in relation to the stabbing.
He has been charged with murder and will appear at an out-of-sessions hearing at Dandenong police station on Saturday night.
Police say the two men knew each other, but would not confirm that they were brothers. Anyone with information can call Crime Stoppers on 1800 333 000.