West Midlands Police had followed the car, which failed to stop for officers, but had called off the pursuit before the fatal crash.
A 17-year-old passenger was pronounced dead at the scene while a second 17-year-old passenger was taken to hospital with serious injuries. He remains in a serious condition.
A third 17-year-old teen was found close to the scene and has been arrested on suspicion of causing death by dangerous driving and theft of a motor vehicle. He remains in police custody.
A spokesman for West Midlands Police said: "The road was closed for a number of hours while emergency services and collision reconstruction experts established the circumstances of the collision.
"Anyone who witnessed the incident is asked to call the Collision Investigation Unit on 101."
Due to the nature of the crash, the matter has been referred to the Independent Police Complaints Commission (IPCC).
The spokesman added: "They have stated that they will investigate this matter as an independent investigation, which is routine in cases of this nature."
The crash happened on Church Road, Yardley, Birmingham, around 4.15pm yesterday.