Police were called at 2.50pm to the crash scene, about 200m north of the township.
A police officer at the scene said the victims were both women, one 57 years old and the other 25.
The 57-year-old had sustained serious injuries and was airlifted to Dunedin Hospital.The other woman sustained moderate injuries and was being taken to Dunedin Hospital by ambulance.
The women were thought to be in separate cars and both were trapped for a time after the crash.
The road was blocked and diversions were in place and motorists had been asked to be patient.
A St John spokeswoman earlier said three ambulances and a helicopter attended.
A police spokeswoman said at 5.20pm the road was still closed, so the Serious Crash Unit could investigate.