A Kia Picanto and a Ford Focus collided on the A65 Burton Road at the junction with Helmside Road in Kendal.
The 84-year-old female driver of the Kia, Margaret Patterson from Kendal, was taken to the Royal Preston Hospital after Monday's accident but died a day later.
The 26-year-old male driver of the second car suffered minor injuries.
An elderly woman who suffered severe injuries in a two-car crash in Cumbria has died in hospital.