UPDATE: Mystery surrounds the circumstances of a fatal plane crash in northern NSW which killed two men yesterday.

The aircraft burst into flames when it crashed into a paddock off the Bruxner Highway in South Gundurimba, south of Lismore, at 10.15am (AEDT) yesterday.

Two men, believed to be a 47-year-old and a 40-year-old from the Gold Coast, died at the scene.

The crash sparked a grass fire and debris was strewn around the wreckage.

"There is a large debris field of about 50 metres in length," a Fire and Rescue NSW spokesman said.

It is believed the Socata Trinidad took off from Gold Coast Airport about 9.30am (AEDT) and was heading south to Murwillumbah Airport.

A focus of the investigation will be how the plane ended up in South Gundurimba, about 80km south of Murwillumbah.

Police from Richmond Local Area Command, crime scene officers, as well investigators from the Australian Transport Safety Bureau, remained at the scene last night.

The cause of the crash was not yet known, but one witness told the Seven Network the plane banked hard left, then "fell like a rock" to the ground.

Meanwhile, a light plane has been destroyed, but its pilot only slightly injured, after a crash landing metres from the edge of a dam in Western Australia.

The single-engine Jabiru plane suffered engine failure at about 2000 feet (610 metres) yesterday, forcing the pilot to ditch on the edge of Wungong Dam, 45km southeast of Perth.

The plane split in two on impact, but the pilot walked away with minor injuries, and did not require hospital treatment after being airlifted by the RAC rescue helicopter.

WA police officers were securing the crash scene, with Recreational Aviation Australia, the regulatory body for light aircraft in Australia, likely to carry out a review of the possible causes of the engine failure.