Emergency services were called to Hewitts Camp Site at Benllech on the east coast of Anglesey, shortly after 2am.
Amanda Jane Arnold, aged 31, her daughter Jade, two, and son Aiden, five, were taken to Ysbyty Gwynedd in Bangor.
Jade, who had 95% burns, later died and Mrs Arnold and Aiden also suffered severe burns.
The three victims, who are from Staffordshire, were taken to Ysbyty Gwynedd hospital in Bangor.
Aiden was transferred by helicopter to Booth Hall children's hospital, Manchester, where he was said to be "seriously ill".
Mrs Arnold was transferred by ambulance to Withington Hospital, Manchester, where she was said to be stable.
Cause of blaze probed
A 37-year-old man camping in an adjacent tent suffered burns to his hand while trying to rescue the family. Both he and an eight-year-old boy were treated for superficial burns and shock.
A joint investigation into the cause of the blaze has been launched by North Wales Police and North Wales Fire Service, although early reports suggest the fire started after a candle was knocked over.
Safety appeal
A North Wales fire brigade spokesman appealed to families on camping holidays never to have naked flames in tents.
"During this holiday season when there are thousands of campers up and down the north Wales coast, we are asking people to be extremely safety conscious.
"We urge people to take care when using cooking equipment, lighting equipment and especially with naked flames and smoking materials," he said.
The findings of the inquiry would be passed on to the North Wales coroner, he added.
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