Geeta (5) and Chitti (10) were killed when the wall of their shanty collapsed around 1 AM in Nagar Tanda near Ramayapet, sub inspector Nagarjuna Goud said.
The two siblings were killed on the spot while their parents suffered minor injuries, he said.
Ramayampet and its neighbouring villages have been receiving continuous rains since the last three days.
Meanwhile, five supervisors of the Kanpur Development
Authority have been suspended and recommendation has been made for suspension of three engineers, KDA vice-chairperson Jaishree Bhoj said.