A head-on collision between two cars in Victoria's Gippsland has left one woman dead and a man fighting for his life in hospital.

The cars collided on the Princes Highway in Cann River on Wednesday afternoon.

The passengers in each car were airlifted to hospital, where the woman later died, while the man is suffering life-threatening-injuries.

The two drivers are also both in hospital, with one in a serious but stable condition.

© AAP 2017