The toddler was crossing the road with his family in Pinfold Street, in Darlaston, at around 8.45am on Monday when he was hit.
An air ambulance was sent to the scene but the boy was taken to Birmingham Children's Hospital by land ambulance with "potentially serious injuries".
West Midlands Police officers have launched an investigation and say the drivers of the two cars are "co-operating with officers".
A spokesman for the force said: "We are investigating after a three-year-old child was hit by two cars while crossing the road with his family on Pinfold Street in Darlaston, Walsall, just before 9am this morning.
"The child has been taken to hospital with serious injuries to his head. The drivers are co-operating with officers."
A spokesman from West Midlands Ambulance Service said: "We were called at 8:46am on Monday to reports of a collision involving a car and pedestrian on Pinfold Street, Wednesbury.
"We sent the Midlands Air Ambulance from Cosford, a land ambulance, a paramedic officer and the Midlands Air Ambulance Critical Care car.
"Crews treated one patient, a boy, who was the pedestrian, for potentially serious injuries and he was conveyed by land on blue lights and sirens to Birmingham Children’s Hospital for further treatment.”
Anyone with information is urged to call West Midlands Police on 101, quoting log number 768 of December 14. Alternatively, witnesses can call Crimestoppers anonymously on 0800 555111.