A TEACHER who went missing on her way home from a Halloween party was found dead in a creek in a posh Colorado ski town, according to officials and a local report.

Margo Taryn Khalili, 26, left a party in Vail Village around 10:30pm on Wednesday (local time) and took a bus home to East Vail, but authorities haven’t been able to determine what happened after she got off the bus, ABC 7 Denver reported.

Police released a missing person alert for Ms Khalili — showing her wearing a Halloween costume with purple hair, makeup and a purple flower crown.

By 2pm on Thursday, the young teacher was found dead in Gore Creek, a popular fly fishing spot, officials said.

She lived close to the spot where she was found, cops told the station.

Police did not immediately suspect foul play but remain uncertain about what exactly occurred.

“We don’t know if she got lost in the dark and ended up falling or not,” Vail Police Commander Ryan Kenney told the station.

“We are not sure if hypothermia played a role in it, but she did end up in the creek. There was new snow this morning so footprints were covered over and there is not a lot for us to go on right now.”

Locals of the small town at the base of Vail Mountain, home of a massive ski resort, were stunned by the news.

“People are shocked,” Cornelius Nienaber, who said his colleagues at the Bully Ranch restaurant in Vail Village knew Ms Khalili, told the station.

“They don’t know what to do. They don’t know what to think. You just feel sad, obviously, for her, her family.

“I mean nobody really knows right now what happened. Everybody is in the dark. You feel for her boyfriend and you feel for the staff — the people that you work with that knew her.”