Grapevine police spokesman Sgt. Robert Eberling said the shooter showed up in the costume shortly before gunfire erupted and that the family appeared to have been opening Christmas presents. Police responding to a 911 call found four females and three males dead. They also found two handguns.
"We think he was just inside there celebrating Christmas with the rest of them and decided for whatever reason that's how he's going to end things," Eberling told The Associated Press.
Investigators worked through Sunday night and into Monday morning, meticulously searching the apartment where the bodies were found, along with vehicles parked outside. Police said they believe the victims were related, though some were visiting and didn't live in the apartment.
Eberling said investigators were assembling a "family history," and that the apartment was leased to a woman and her two children, one age 15 and the other either 19 or 20. He would not give other specifics.
"We're getting a clearer picture, but we're not ready to go on the record with anything until we find out from the medical examiner absolute confirmation of identities and the manner of death," Eberling said.
Autopsies of the shooter and the victims were being done Monday by the Tarrant County medical examiner, but it would probably be Tuesday before their identities were released, he said.
Late Sunday evening, police intently searched a sport utility vehicle parked outside the apartment. The vehicle is registered to a man who listed his residence as a home two miles away in the neighboring suburb of Colleyville.
Records show the couple living at the home had financial problems and that their home, most recently valued on the county tax rolls at $336,200, had been sold in 2010 at a foreclosure auction - although it appeared the man was still living there.
The shootings Sunday were the first homicides in Grapevine in more than a year and a half.
Police and firefighters rushed to the Lincoln Vineyards complex about 11:30 a.m. after receiving a 911 call in which no one was on the other end of the line. Because no one responded on the phone, police went into the apartment, located at the back of the complex. They found the seven, aged 15 to 60, dead.
Many of the nearby apartments are vacant, and police said no neighbors reported hearing anything on a quiet Christmas morning when many people were not around.
The Associated Press contributed to this report.