Police were called to the A361 near Barnstaple at 08:25 BST after the woman's car hit an oncoming lorry.
The woman's husband was travelling in a separate vehicle and saw the crash unfolding behind him.
Car in which three died 'crossed centre white line' and hit truck
BBC News Online
A car in which a woman and her two children died 'crossed the centre white line' and hit a lorry on the A361 near Barnstaple, police said.
The woman's husband, and children's stepfather, was travelling in a separate vehicle in front and witnessed the crash at about 08:20 this morning.
Inspector Richard McLellan said: "It would seem that a car travelling towards Barnstaple, for unknown reasons at the moment, has crossed the centre white line and hit an oncoming truck.
"Unfortunately the family were travelling in two seperate cars but travelling together along this road so dad was there at the scene as well.
"There is a significant amount of damage to the vehicles involved so it takes a while for our collision investigators to go through the scene, we owe it to the families to establish the full facts of what's happened as best as we can."
Mother and two children die in crash
Two children and a woman, believed to be the mother, have died as a result of the collision this morning on the A361 near Lankey Junction, Barnstaple.
Emergency services were called at 8.25am to the A361, near Aller Cross at Barnstaple following the crash involving a car and a lorry.
Three ambulances, five rapid response vehicles and the air ambulance attended the scene near Barnstaple.
Road closures are in place between the West Buckland junction and the Lankey junction on the A361.
Royal Marine terrorist: Ciarán Maxwell had mines and other explosive equipment
A Royal Marine with links to dissident republicanism who made 14 pipe bombs also stashed away an assortment of other weapons and equipment in hides at various sites across England and Northern Ireland, a court was told during a sentencing hearing.
Ciarán Maxwell, 31, who lived in Exminster and serviced with 40 Commando in Taunton, was jailed for 18 years at the Old Bailey after admitting charges earlier this year of preparing terrorist acts.
Police Service of Northern IrelandCopyright: Police Service of Northern Ireland
Along with the 14 pipe bombs, the court heard Maxwell also stashed:
Two anti-personnel directional mines (one is pictured)
Two explosively formed projectiles (EFPs)
29 complete explosive firing systems
33 initiators (part of a detonator for explosives), including two military initiators
13 military "Igniter Safety Fuze Electric" initiators
Three fully-constructed improvised detonators
Other component parts for IEDs [improvised explosive devices]
Other materials and chemicals to make explosives
A replica handgun and ammunition
From Boots to Lifeboat in 10 minutes
Michaela Howells one of the UK's youngest lifeboat crew members takes us on a call out
The Mirror Dinghy World Championships get under way at Mylor in Cornwall today.
Fifty-one crews of all ages from across the world are taking part, including: South Africa, Australia and Japan.
It involves a series of 12 races staged across five days.
Marine who "betrayed his position" is jailed for 18 years
A Royal Marine, who hid explosives in a Devon wood to make bombs for terror attacks, has been jailed for 18 years.
A judge passed the sentence on Ciaran Maxwell who lived in Exminster and was based with 40 Commando in Taunton.
The 31-year-old admitted the preparation of terrorist acts for dissident republicans in Northern Ireland.
Mr Justice Sweeney told Maxwell he betrayed his position in the armed forces.
The case raises serious concerns about how Maxwell was able to smuggle arms from the Somerset base and go undetected.
Stephen Martin is the Assistant Chief Constable of the Police Service of Northern Ireland:
Man witnesses crash that kills wife and step-children in Devon
What we know so far...
A woman and her two young children have died in a crash witnessed by her husband
Police were called to the A361 near Barnstaple in Devon at 08:25 BST after a car and a lorry collided
The man was travelling in a separate vehicle and saw the crash unfolding behind him
His family is believed to have been on holiday in Devon from elsewhere in England
Three ambulances, five rapid response vehicles and the air ambulance attended the scene near Barnstaple
Road closures are in place between the West Buckland junction and the Lankey junction on the A361
Royal Marine terrorist: Ciarán Maxwell jailed
Metropolitan PoliceCopyright: Metropolitan Police
A Northern Irish Royal Marine who built explosives for an Irish republican dissidents has been jailed for 18 years.
Ciarán Maxwell, who lived in Exminster and served with 40 Commando in Taunton, admitted preparing acts of terrorism at an earlier trial.
The trial at the Old Bailey heard Maxwell, originally from Larne, stashed anti-personnel mines, mortars, ammunition and 14 pipe bombs - four of which were deployed - in 43 purpose-built hides at eight locations in Northern Ireland and England.
Mitigating, his sentencing hearing was told the 31-year-old lived a "dangerous double life" as a terrorist bomb-maker and claimed he faked sympathies for the Irish republican cause because he was "paralysed" with fear.
Plymouth’s got a major problem with sexually transmitted diseases
Apart from a scattering of showers, many places will be dry with some spells of sunshine. Light or moderate southwesterly winds will be locally fresh around parts of the coast and to the west. Maximum temperature: 19C (66F).
Although a few showers will continue this evening and tonight, most will become confined to coastal areas as it becomes mainly dry and a little chilly inland with clear spells. Winds will be mainly light or moderate from the southwest. Minimum temperature: 11C (52F).
A361 is an 'unsafe road' - MP
BBC Radio Devon
A main road in north Devon which has seen two major crashes in two days is an "unsafe road", an MP says.
Two children and their mother died as a result of a crash involving their car and a lorry on the A361 North Devon Link Road this morning. Three people are still being treated in hospital after a crash on Sunday.
Although acknowledging that investigations were still under way into both incidents, that the causes were yet to be determined and the crashes were a "tragedy", North Devon Conservative MP Peter Heaton-Jones said: "It is a unsafe road.
"We don't know the causes [of the crashes] at the moment, but people are taking too many risks because there are short overtaking lanes that suddenly merge at not much notice."
He said that he, Devon County Council and North Devon Council were working together to "get the money we need to get the improvements to this link road".