UPDATED 6.33PM:

All 16 people aboard a hot air balloon that burst into flames over central Texas after apparently striking power lines and plunging into a field, have died.

This makes it one of the deadliest such accidents on record.

"There's massive power lines that are above where police tape is lined and marked off and where investigators are looking. We have not confirmed anything as to whether the power lines caused the fire and the crash, but from my eyes that's what we're seeing", said a witness at the scene.

It crashed into a field in Lockhart, 50ks south of the city of Austin, Texas.

Authorities said there will be a full investigation into the crash, which occurred in clear, calm weather.

"We'll have victim specialists and weather experts. All will be arriving tonight to begin what will be a significant investigation into this tragedy. To the families that may be watching us right now, we offer our thoughts and prayers for the loss."