The 27-year-old woman was pronounced dead at the scene while the second pedestrian, a man aged 28, is in hospital with life-threatening injuries.
Police have arrested a 31-year-old man on suspicion of causing death whilst driving without due care and attention.
He remains in custody for questioning and inquiries are ongoing.
The suspect was arrested at the scene of the collision, involving a red Volkswagon Golf car, at around 3.35am on Manchester Road in Ashton-under-Lyne.
Inspector Danny Byrne, of Greater Manchester Police’s Serious Collision Investigation Unit, said: “This morning’s incident has had truly tragic consequences and we have specialist officers supporting the woman’s family as our inquiries continue.
“Our thoughts are also with the man and his family as he receives treatment in hospital and we’re appealing to any witnesses or anyone with any information or dash-cam footage to get in touch with us as soon as possible.
“Whilst we have a man in custody, our investigation is continuing and it’s incredibly important we establish the circumstances surrounding this collision. I’d urge anyone who thinks they might be able to assist us to call our team.”
Anyone with information should call GMP’s Serious Collision Investigation Unit on 0161 856 4741 quoting incident number 460 of 28/11/2020, or the independent charity Crimestoppers, anonymously, on 0800 555 111.
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