Zaneta Krokova, 11, was holding the hand of her 12-year-old cousin Helina Kotlarova when they were hit by a blue Peugeot 807 in Oldham, Greater Manchester.
The girls had just come out of a shop near their homes when they were struck in Ashton Road at around 7.15pm.
Greater Manchester Police said that Miss Krokova died on Monday morning.
Her older cousin was killed at the scene.
Four men aged 59, 48, 38 and 18 were arrested on suspicion of causing death by dangerous driving and are in custody for questioning.
A fifth man, 23, was released with no further action being taken and is assisting police with their inquiries.
The car which hit the girls has since been found abandoned on Honeywell Lane, police said.
The older girl's mother Sylva and father Robert raced to the scene but she was declared dead by medics as her distraught mother stroked her hair.
On New Year's Day, the family of seven sisters and one brother, who came to England from the Czech Republic eight years ago, sat in tears mourning the 12-year-old.
Her father sat with his head in his hands, his wife weeping, while other red-eyed members of the family sat in silence in the kitchen of their terraced home.
Helina's sister Sylva, 19, told how the family rushed to the scene 100 yards from their home seconds after the crash.
She said: "Her face was all bloody. She did not breathe. Mum was touching her hair."
Miss Kotlarova said the girls were with a larger group of family and friends who had already crossed the road, one of the main routes in and out of Oldham town centre, and the larger group was waiting on the opposite pavement.
The two cousins then started to cross the road outside the shop.
Miss Kotlarova said: "But as they came to the other side of the road the car ran them over. They were holding hands."
Seconds later friends ran to Helina's home to alert the family.
Miss Kotlarova added: "We ran there. I went to her. Her face was all bloody. She did not breathe. Then the ambulance came."
She said Helina attended the Collective Spirit free school in Oldham and enjoyed dancing and music and wanted to become a singer.
Sergeant Lee Westhead said: "This is a heart-breaking incident which has now taken the lives of two young girls and all of our thoughts remain with their families, who are understandably devastated.
"We have made significant progress with our investigation since the collision happened and I would like to thank everyone who has contacted police with information so far."
Officers are appealing for anyone who saw a dark coloured Peugeot 807 in the area at the time and the driver of a white van to come forward.
Sergeant Westhead added: "As you can see in the images, the vehicle is dark blue, people carrier shaped and is in poor physical condition and notably has pre-existing damage to its rear window.
"Did you see this vehicle on Saturday 31 December in the hours before or after the collision?
"Finally, I am also keen to speak to the occupants of a white Citroen Despatch van that I am also releasing an image of. This vehicle did not collide with anyone but was in the immediate vicinity of the collision and may have key information.
"Again if you saw this vehicle or have any information about its occupants or why it was in the area at the time of the collision, please contact us."
Anyone with information should call police on 0161 856 4741, quoting incident number 1691 of 31/12/16, or Crimestoppers, anonymously, on 0800 555 111.