A 15-year-old boy and 11-year-old girl, who were travelling in the back seat of the Mazda 3 sedan, received fatal injuries in the incident, at about 7.40pm yesterday.

The victims died at the accident scene.

It's understood the teenage driver, a 16-year-old girl, was the holder of a NSW learners permit and unaccompanied by a licensed driver at the time of the crash, police said.

The female driver and 14-year-old male front seat passenger sustained critical injuries and were treated by paramedics at the scene before being flown to Newcastle's John Hunter Hospital.

The girl remains in an induced coma, while the injured boy has since been airlifted to The Children's Hospital at Westmead for emergency surgery.

The car is believed to have turned right from Milton Barnett Street onto North Street when it hit the power pole.

Betty Kennedy, who lives opposite the accident scene, said she heard a loud bang and initially thought it was thunder.

She said she and her daughter's boyfriend rang the police and ambulance and ran to the wreckage.

She said she saw a young girl with her head in a sleeping position and asked if she was OK but received no reply. There was silence and a little movement in the car, she said.

"It was a very sad and tragic accident," she said.

About 150 neighbours gathered at the accident scene last night. It is believed the families of the victims have been informed.

Police from Mid North Coast Local Area Command attended the scene.

Crash Investigation Unit officers from Port Macquarie are continuing their inquiries into the circumstances surrounding the incident, including speaking with the registered owners of the vehicle.

Anyone who witnessed the crash is urged to contact Crime Stoppers on 1800 333 000.