It happened on the Scarva Road in the town on Monday afternoon.
The girls are pupils at St Mary's Primary School. One is aged 10, the other 11. The accident happened down the road from the school.
Both are believed to have head injuries and one girl also suffered a neck injury and a broken leg.
One has been taken to Craigavon Area Hospital where she is in a stable condition. The other was taken to the Royal Hospital in Belfast. The Belfast Health Trust said her injuries are not thought to be life-threatening.
The principal of St Mary's said the area where the accident happened lost its crossing patrol person 10 years ago and has since been "an accident waiting to happen".
He said both pupils are very lucky to be alive.
DUP MLA Carla Lockhart said: "Children leaving school - you can imagine them bouncing out the door, heading for home and for this accident to have taken place, it doesn't bear thinking about," she said.
"My thoughts and prayers are very much with the driver of the vehicle as well, I can only imagine the turmoil that this has caused them.
"We're thankful that the two children are receiving medical treatment at Craigavon Area Hospital and the Royal Victoria and our thoughts and prayers are very much with them and their families."
Police have said the Scarva Road has been closed in both directions.
Two schoolgirls have been injured after being struck by a car while crossing a road in Banbridge, County Down.