Trainer Lisa Rae says New Zealand racing has been hit hard by the death of Gold Coast-based New Zealand jockey Ashlee Mundy after a fall at Sunday's Kurow races.

A freelance jockey, former Cantabrian Mundy returned from Queensland in mid-December to ride the South Island's summer circuit.

She had been working at Rae and husband Kenny's Riccarton stable in Christchurch during her stay and planned to return to Australia in February.

Her mount Elleaye fell with 600m to run in the seventh race at Kurow in North Otago.

Nigel McIntyre of the New Zealand Racing Integrity Unit (RUI) told NZ Newswire it appeared Elleaye had clipped heels with another horse.

Mundy, 26, was flown to Dunedin Hospital in a critical condition with serious head injuries and a hospital spokeswoman confirmed she died on Monday morning.

Rae said Mundy had returned from Australia to contest the southern holiday circuit for the past couple of years.

She spent Christmas with her parents in Westport, then had six races at Wingatui on December 28, including a win on Fintorro for the Raes.

"She's the wrong person - she's been taken too soon.

"She'd rock up every morning ready to ride - she was just one of those people who have a natural way with animals," Rae told NZ Newswire.

"Our owners are broken, they're distraught. Ashlee was just lovely. She's touched so many people's lives."

McIntyre says the RUI will conduct a full investigation into the incident, including talking to riders and viewing the race video, and will be working in conjunction with the police who will prepare their own report.

Deaths at New Zealand race meetings were rare, McIntyre said. The last one was in 2005 at Riverton when 16-year-old Sam McRae died after his foot became entangled in his horse's riding iron and he was dragged for 900 metres.

Mundy had ridden 232 winners in New Zealand and 43 in Queensland.