Detectives have identified several potential suspects and are hopeful of a swift arrest.
Homes in South Australia and the ACT have been raided, and detectives have spoken to violent offenders in NSW prisons who were known to be in areas at the same time as Karlie and Khandalyce.
"We've looked at and are now speaking to people who we suspect have actual knowledge of what occurred to this young mum and her little girl," said NSW Police Homicide Squad Commander Mick Willing.
Family and friends who knew Karlie in Alice Springs have been ruled out as suspects.
Investigations are focusing on those who met the mother and daughter on the road as they travelled around Australia.
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It is believed Karlie was killed in December 2008 in or around NSW's Belanglo State Forest where her remains were found in 2010.
Where and when Khandalyce died and how her remains ended up near a suitcase 1200 kilometres away in South Australia five years later is still a mystery.
