Police recovered 12 slaughtered horses and rescued one sick horse from an abandoned house at Bhoberchar in Gazaria upazila of Munshiganj early Wednesday, creating panic among local residents.
Locals said the house had long been used by an organised group to carry out illegal activities in secrecy.
Sensing something suspicious, local people went to the spot and found the slaughtered horses, said police.
On information when police rushed to the spot the members of the gang fled the scene, leaving behind the carcasses.
The group allegedly used to buy sick horses at low prices from different areas, slaughter them, and sell the meat to various hotels as beef.
Police later recovered a mobile phone believed to have been used by the group.
Gazaria Upazila Nirbahi Officer Md Mahmudul Hasan said there is no legal provision for slaughtering horses under the Animal Slaughter and Meat Quality Control Act, 2011.
No one could be detained at the scene and police are continuing efforts to identify and arrest those involved, he said.
The recovered horse meat will be buried in the presence of representatives from the Department of Livestock and local union parishad members.
The rescued horse is currently under treatment by the livestock department, he said.