Sergeant Steve Watt said the girl, another 16-year-old girl and a 16-year-old boy, were driving on Littles Rd towards Dalefield Rd about 4.30pm when their Nissan Pulsar crossed the centre line and collided with an oncoming late model Mercedes and rolled.
The girl, a backseat passenger in the car, died at the scene.
The female driver was flown to Southland Hospital with life-threatening head and chest injuries, and the boy was taken to Lakes District Hospital, and later airlifted to Dunedin Hospital.
Both survivors were in a critical but stable condition last night, Sgt Watt said.
"They have suffered life-threatening injuries."
All were from the Queenstown area, and police were working to contact the next of kin, he said.
Early indications were that they were wearing seatbelts, he said.
The occupants of the second car, a mother and two children also from the Queenstown area, were taken by road to Lakes District Hospital with minor injuries.
Serious crash investigators were on the scene last night and victim support was assisting the police with people involved in the crash.
The girl was the first person to die on New Zealand roads this year and the sixth this holidays.
The holiday period began 4pm on December 24 and ends at 6am on January 5.
The provisional road toll for 2009 is 384, 19 more than the previous year, but still the second lowest since 1960.
The total includes 28 people killed in the Southern police district, down from 33 the year before.
National road policing manager Paula Rose said overall it was a good result, given the increase in the number of cars on the road.
"Our challenge going forward is to get that deaths number right, right down so that people don't have to suffer the needless loss and suffering that goes with a road death," she told Radio New Zealand.
• Two people were killed in separate crashes in the Bay of Plenty yesterday evening.
One died in a head-on crash on State Highway 2 at Matata, 23km northwest of Whakatane, about 6pm.
Less than an hour later, a man died after speeding through a police checkpoint and crashing into a ditch near Opotiki.
