Five-year-old Izabelle, her 21-month-old sister and their three-year-old step-brother, Kalais, were rescued from the burning home in Sydenham about 9.30pm on Sunday.
The girls died in hospital this morning surrounded by family and the boy remained in a critical condition, police said.
Detectives from the Arson and Explosives Squad are investigating.
They are working to determine what may have caused the fire and who was in the home at the time and just before to the blaze.
Kalais’ father, Jayde Petalas, who doesn’t live at the house, last week said he was heartbroken after receiving the call from police about the fire.
“They were the best little kids. They would have been petrified,” he said.
“I hope they didn’t feel anything to be honest. Obviously they would have, but I just tell myself they didn’t.”
Police understand the children and their mother had moved into the house the week before the fire. They are probing whether she was home at the time of the fire.
Anyone with information or who may have witnessed the incident is urged to call Crime Stoppers on 1800 333 000.