Officers were called to reports that a car had collided with a tree at the junction of Cattlegate Road and Burnt Farm Ride just before 1am on Tuesday.
The woman, who was a passenger, was rushed to hospital but died as a result of her injuries.
Formal identification still awaits, but her family have been informed, the Met Police said.
The 22-year-old driver was arrested at the scene on suspicion of driving while unfit through drinks or drugs.
He was later arrested for causing injury by dangerous driving, but has now been released under investigation.
Detective Constable Jade Williamson said: “A young woman has tragically lost her life and we owe it to her family to find out why.
"In particular I would ask anyone who saw the incident, or who saw the red Vauxhall Corsa involved being driven before the collision, to call police or Crimestoppers.
"Your information could be vital in helping us to give a grieving family the answers they deserve.”
Anyone with any information is asked to call police on 020 8597 4874 quoting CAD 334/26JAN or contact Crimestoppers on 0800 555 111.
