The boy and three other children - all aged between one and nine - were found during a raid on a remote property at Elands, some 300 kilometres north of Sydney, after police moved in on suspicions that cannabis plants were being grown there.
"Police will allege one of the children was locked in a room for long periods of time over the past few weeks," police said.
The Newcastle Herald said the boy was found in a two square metre area at the back of a tin work shed, the door locked from the outside and with only a single mattress and a bucket inside to use as a toilet.
The newspaper said he appeared to be malnourished.
Detective Chief Inspector Peter McKenna told the Australian Broadcasting Corporation that it was a "shocking" case.
"That side of the investigation is being handled by our child abuse squad," he said.
"We're very thankful we got there when we did and that those children are now having the proper care that they need."
During the raid police allegedly found a "highly sophisticated" cannabis growing operation.
"There was actually a spa bath, a working spa bath, sunken into the deck, in the middle of the deck, so the whole thing just slid across revealing these trap doors," McKenna said.
"I think the offenders there were more surprised than us that we actually found it."
Two men and a woman, aged 28, 26 and 19, were charged with cultivating a large commercial quantity of a prohibited plant and unlawful detention of a person.
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