'Home and Away' actress Jessica Falkholt and her sister are in a critical condition in hospital following a fatal two-car collision in New South Wales yesterday morning that claimed three lives.

Falkholt, who played Hope Morrison on the show in 2016, and her 21-year-old sister are said to be "fighting for their lives" following the crash, which police say was caused by one car being on the wrong side of the road.

Both of Falkholt's parents and the 50-year-old driver of the other vehicle were killed in the accident. Onlookers managed to pull both sisters to safety before both cars were engulfed in flames.

According to local news, the two sisters were airlifted to separate hospitals and have since been joined by family, where they remain in a critical condition.