The accident occurred on the Barnawartha-Howlong Road, near Fleggs Road, about 3.30pm.

It is believed a white Holden Commodore travelling south towards Wodonga collided with a red compact car travelling in the opposite direction.

The driver of one vehicle has died while the other was seriously injured and likely to be flown to Melbourne for treatment.

A crime scene has been established with police from the major crash investigations unit in Melbourne travelling to the scene.