The wreckage of the plane, with 18 people aboard including three crew members, was found in the Arghakhanchi district Monday morning. India's Hindu newspaper reported all 18 bodies had been recovered.
The aircraft went down Sunday afternoon while on a flight from Kathmandu, capital of the Himalayan republic, to Jumla, about 250 miles away in the western part of the country.
Arghakhanchi district is also in the western part of the mountainous country, located in the Lumbine zone, the birthplace of Gautama Buddha.
The wreckage was found by an army helicopter at an altitude of 7,000 feet, Nepalnews.com reported.
Those aboard included a child and a Danish national.
"Our helicopter has identified a wreckage on the side of a hill in Arghakhanchi," the report quoted army representative Jagdish Pokharel as saying earlier.
The search teams also included personnel from police and armed police. Their efforts began after area villagers reported hearing a loud sound. The mobile signal of the pilot of the plane also had been located in the area.
Nepalnews said 14 of those aboard the plane were Nepalese. The identities of the others were not immediately known.
The plane was bound for Jumla from Kathmandu after a scheduled halt at nearby Pokhara. Officials were quoted as saying communication with the plane was lost about 1 p.m. after it left Pokhara's airport and about 45 minutes before it was scheduled to land at Jumla.
Ekantipur.com said the plane had crashed in a wooded section of the district's Masine Lek area.
While authorities investigated the cause of the crash, early reports had indicated there was heavy rain and snow along the route.
The BBC said 13 private airlines in Nepal serve nearly 50 airports, many of them in difficult locations, surrounded by mountains with no road access.
The European Union in December blacklisted Nepal's airlines, citing safety concerns, the BBC said.
In 2012, two separate crashes in Nepal left 34 people dead. In September of that year, a Sita Air plane crashed near Kathmandu, killing 19 people. Fifteen people died in May 2012 when a plane operated by Agni Air crashed at a high-altitude airport.
More than 650 people have been killed in plane or helicopter crashes in Nepal since 1949.