The crash happened just before 1 a.m. Saturday on Pacific Coast Highway and Sunset Boulevard, according to the Los Angeles Fire Department.
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Firefighters say a Dodge Charger driving south on PCH collided with several parked cars and pedestrians, including the deceased victim who was also found down on the beach.
That person, identified as a 32-year-old woman, had been overlooking the beach with family when they were fatally struck.
Six other people were taken to the hospital, one of them in serious condition.
A witness says he heard racing and ran outside to find a tragic scene.
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"I was siting in my car and I heard tire screeches, sounded like another car hit another car," said James Gallardo. "There was an innocent family sitting down there, I guess, and they got hit by the car that was racing that went over the edge."
Police say the driver, a 21-year-old man, was arrested on suspicion of driving under the influence.
DEVELOPING: We will add more details to this report as they become available.