NSW Health Minister Jillian Skinner says the death of a baby in a Sydney hospital will be investigated.
Another baby remains in a critical condition after the newborns were mistakenly treated with nitrous oxide, or "laughing gas", instead of oxygen at Bankstown-Lidcombe Hospital.
Ms Skinner said she was "profoundly sorry" for the families of the babies, who were born in the last two months.
"I've described it as a devastating error. That is what it is. Short and simple," Ms Skinner told reporters in Sydney on Tuesday.
The error was discovered last Thursday when a pediatrician raised concerns following the death of one of the babies, she said.
She said the hospital had now checked all eight of its operating theatres.
"There were only two babies affected fortunately," she said.
"I have asked for every newly commissioned operating theatre over the last five years to be checked. That is being done."
An oxygen machine in one of the hospital's theatres was incorrectly installed and certified by gas supplier BOC Limited in July last year, the minister said on Monday.
On Tuesday she clarified that the fault has occurred via a gas line not a cylinder.
"I am assured that there are no other instances such as this. Further to this, the coroner will be investigating, an independent investigation."
"I have asked for a further investigation involving southwest Sydney, the district where this hospital is concerned, but chaired by an independent obstetrician to look further into how this happened and a report will be provided to me within a week."
She said BOC Limited is also conducting its own inquiry.
