Cameron House, a five-star resort on the banks of Loch Lomond frequented by the rich and famous, was devastated by a blaze that broke out around 6.40am.
Guests were forced to flee their rooms in their night clothes into the freezing temperatures outside after the alarm was raised.
Rescue services confirmed on Monday afternoon that one guest was pronounced dead at the scene while another later passed away at the Royal Alexandra Hospital in Paisley.
Three other people, including a child, were taken to Glasgow’s Queen Elizabeth University Hospital for treatment. They were later released.
A major joint investigation by police and fire services has now been launched into the cause of the tragedy at one of the country’s leading high-end tourist attractions.
David McGown of Scottish Fire and Rescue, speaking at the entrance to the hotel today, said crews were dispatched at 6.40am to deal with a blaze which had caused “extensive damage”.
“Unfortunately two people have lost their life as a result of the fire,” he said. “The rescue services send their condolences to people involved in this tragic incident and our thoughts are with the families and friends of the two people who have lost their lives this morning.”
He continued: “The fire has caused extensive damage to the central section of the hotel. Our crews have been working tirelessly since 7am. We had 14 fire appliances at its height and more than 70 firefighters. As you can imagine, as well as being a tragic incident, this was an extremely complicated fire to contain. We are continuing to work with partners to bring this incident to a safe conclusion.
“But, to reiterate, our thoughts and condolences are very much with the two people who have lost their lives.”
One guest, Ainsley Huxham, told BBC Radio Scotland that she was initially unaware of the seriousness of the situation. “As soon as we left our room - I just thought it was a fire alarm, just like a practise go,” she said.
“But when we left - five stairs down from our room - we saw a whole room full of smoke and flames.
“So we had to run back down the hall, chapped on everyone’s doors and shouted ‘fire!’.”
She added: “We got out within five minutes of the fire brigade getting called.
“And by the time we had got outside, the whole field was full of people.”
Thick white smoke continued to billow out from the roof of the central section of the luxury hotel seven hours on from when the fire started.
The car park was filled with emergency service vehicles which included 14 fire appliances, including high-reach vehicles, were in attendance at the scene as of 2.45pm on Monday.
Much of the interior of the main central section of the hotel, thought to be the oldest part of the hotel, is visibly blackened.
And the vast majority of upper floor windows have been smashed as jets of water fought the flames.
The Salvation Army were also in attendance to provide the emergency services with food and drink.
Police chief inspector Donald Leitch told reporters that officers were working to establish the circumstances of the fire.
He said: “At 6.50am, Police Scotland were called to Cameron House Hotel where 200 people were evacuated from the hotel which has been partly damaged.
“We continue to work with our partners to establish the exact cause of the fire, and this will go on for some considerable time.
“One person, as previously stated, was pronounced dead at the scene. Four were taken to hospital where one person tragically died.”
The names and ages of the guests killed had not been released on Monday evening.
Cameron House is owned by US investment firm KSL Capital Partners. The company reportedly paid around £70m for the 132-room property in 2015.
Andy Roger, resort director at Cameron House, said: “At approximately 6:40am there was a large fire at Cameron House Hotel. Emergency services were alerted and guests were evacuated to the nearby Boat House Restaurant while Scottish Fire & Rescue, Scottish Ambulance Service and Police Scotland arrived on scene.
“Tragically, the authorities have confirmed two fatalities from the fire. In addition, three individuals were transported to the local hospital, but have since been discharged. The safety and well-being of our guests, employees and neighbours is our first priority, and our deepest condolences are with the families of those affected.
“We are working closely with the authorities to determine the cause of the fire, and to provide support to our guests and the families of those affected.”