A small outback town has been devastated by a tragic underground mine explosion that left a man and a young woman dead.

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Emergency services responded to the disaster at Cobar, in northwest NSW, at 3.45am on Tuesday, and were told one man had been confirmed dead after the explosion.

Two women were then brought to the surface, but one of them died shortly after.

The dead have not yet been formally identified, but they are believed to be a woman in her 20s and a man in his 60s who had both been living in Cobar.

The second woman, also a Cobar local in her 20s, was flown to hospital suffering hearing damage and shock.

Cobar mayor Jarrod Marsden

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