It is believed the baby's mother, aged 19, is still fighting for her life in hospital.

Queensland Health this morning said a woman was transferred from the north Queensland indigenous community of Palm Island to Townsville Hospital on Saturday in a critical condition.

She is still being treated for swine flu in intensive care.

"Due to patient confidentiality we can't say anymore at this stage," a Queensland Health spokesman said.

Local newspaper The Townsville Bulletin reported the woman had carried her child to 36 weeks before the baby passed away.

The death would become the second swine flu-related fatality in the state, after a 38-year-old woman died at Brisbane's Mater Public Hospital last week.

Queensland's swine flu tally has risen by more than 300 in one day.

Across the state there are 4137 confirmed cases of the human swine influenza (H1N1) - an increase of 326 since Sunday.

Queensland Health says 40 people are currently in hospital with swine flu, 18 of them in intensive care.

Another 20 people admitted to hospital are suspected as having the virus and eight of those are also in intensive care.

The reports have added to concerns the Palm Island community may not be able to cope with a swine flu outbreak due to insufficient housing and health infrastructure.

A Queensland Health spokesman said a flu clinic would open today at the island's community health centre.

"Queensland Health has remained active by setting up flu clinics when and where necessary (and) ...developing a range of resources in different languages as well as indigenous," the spokesman said.