The Nissan Micra crashed while heading eastbound on the A27 at Chichester at 7.20pm on Saturday.
Police and paramedics rushed to the scene, between the Stockbridge and Whyke roundabouts, and closed the road.
The 20-year-old woman, who was in th
e front passenger seat, suffered serious injuries and was taken to St Richard's Hospital, Chichester, where she later died.
The woman, from Horsham, West Sussex, has not yet been named by police as next of kin are still being informed.
The Micra's driver, a 19-year-old woman, was arrested on suspicion of causing death by dangerous driving and is being interviewed by police.
She sustained minor injuries. The driver of the tractor was not hurt.
The road was closed for more than five hours as police surveyed the scene for evidence, causing major delays for motorists.
Traffic was diverted through Chichester city centre and the road was reopened at about 12.30am yesterday.
Police are appealing for witnesses to the crash.
Anyone who saw the accident should contact Chichester Roads Policing Unit, quoting Operation Ludham, on 0845 6070999.
The full article contains 208 words and appears in NS-Havant & Waterlooville newspaper.