East Gippsland Crime Investigation Unit detectives have arrested a woman following a fire in Nicholson overnight, Victoria Police say.
The blaze broke out about 12.30am at a home on Nicholson-Sarsfield Road.
A 36-year-old man who was home at the time suffered smoke inhalation and was taken to hospital for observation.
Two girls, aged 4 and 6, were treated at the scene for smoke inhalation.
A 34-year-old woman returned to the scene and was taken to hospital for assessment.
She has since been released and will be interviewed in relation to the fire later today.
The investigation is ongoing and an arson chemist will attend the scene this morning.
Anyone with information is urged to contact Crime Stoppers.