Emergency services were called to the Pacific Highway near Wadalba near Wyong about 2.15am today following reports that a Mercedes sedan and a Kia hatchback had collided.
The driver of the hatchback, a 45-year-old woman, and her passenger, a 38-year-old woman, both died at the scene.
Police believe the Mercedes veered onto the wrong side of the road, resulting in a head-on collision.
The crash caused the sedan to roll several times.
The 49-year-old male driver of the sedan was treated at the scene for arm and leg injuries by paramedics.
He was taken to John Hunter Hospital, where he remains in a serious condition.
The driver will be subjected to mandatory testing.
The road was closed in both directions following the crash.
The highway remains closed in the southbound direction.
A crime scene has been set up and police are investigating.
Both cars were seized for forensic examination.
Speed and the manner of driving will be a focus of the investigation police say.
A report will be prepared for the coroner.
