It happened just before 3pm on the A386 near Bideford and involved a BMW, a Vauxhall Astra and a Citroen Dispatch.
A 41-year old woman from Torrington, who was passenger in the Astra, died at the scene.
A 29-year-old man from Bideford was detained on suspicion of causing death by dangerous driving - he was later released under investigation pending further enquiries.
Police are appealing for witnesses.
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