TV footage on the country’s public broadcaster NHK showed the house engulfed in flames late on Wednesday night.
Of the 16 people living in the home, five were rescued by firefighters battling the blaze.
The three-storey building in the northern city of Sapporo is home to mostly elderly residents.
The home is run by an organisation providing affordable accommodation and helping people on welfare find work, NHK reported.
Authorities have launched an investigation into what caused the fire.
In 2010, seven people were killed in a fire at Sapporo nursing home for the elderly. (Courtesy BBC)