Mr Machado said about 100 people, including police and navy boats, were searching for survivors.
"Based on our conversations with neighbours, the number of victims could reach 40," he told Brazilian CBN radio.
The Sankay lodge resort can only be reached by boat.
Officials said most of the bodies recovered so far were found on land, but at least three had been pulled from the sea.
Witnesses told reporters the houses and the resort had been hit by a piece of the hillside measuring some 300m across.
Wooden sections of the lodge could be seen floating close to the shore and on the beach, the Associated Press news agency reported.
Full to capacity
The deputy governor of Rio state, Luiz Fernando Pezao, said: "It's a vision of horror... a mountain of rocks and trees covering various homes."
The lodge was full to capacity with about 40 guests bringing in the new year at what was considered an idyllic location.
A civil defence spokeswoman told Reuters news agency that more heavy rain was forecast and this would make rescue work harder.
"Rescue crews told us there is so much mud and water there which, coupled with the fact that the site is one of very difficult access, forces them to remove all the mud manually... without the aid of heavy equipment," she said.
Although heavy rain had stopped on Friday, authorities have put the city of Rio on alert for fear of mudslides hitting its densely populated hillside shanty towns, known as favelas.
Other landslides in Angra dos Reis killed seven people early on Friday.
On Thursday at least 19 people died as heavy rains triggered mudslides in Rio de Janeiro state.
Officials said most of those deaths occurred as shanties collapsed under mud or rain in the greater Rio city area.
Local authorities have declared three days of mourning.
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