The bodies of two women and 15 men were found by the side of a road in the Kajaki district.
They were either beheaded or had had their throats cut. Some showed signs of beatings or had gunshot wounds.
Meanwhile, 10 Afghan army soldiers were killed in a Taliban attack in the same province.
In eastern Afghanistan, two US soldiers were shot dead by an Afghan National Army soldier.
The bodies of the 17 civilians were discovered on Monday morning.
Local officials said the men had gathered to listen to music and watch the women dance when they were attacked. The Taliban disapprove of men and women mixing socially.
"I can confirm that this is the work of the Taliban," the Helmand provincial governor's spokesman, Daud Ahmadi, told AFP news agency.
He added that the men and women were "partying with music in an area under the control of the Taliban".
The BBC's Quentin Sommerville, in the capital Kabul, says some reports suggest the 17 were killed because they were local government workers.