The fire broke out around 1:30 a.m. on the unit block of West Summit Avenue just south of Maryland Avenue.
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Fire crews arrived to find the home completely engulfed in flames and they struck a second alarm.
Two injured in house fire in Delaware
Firefighters would later find a 63-year-old woman lying on the front lawn of a neighbor's home.
She was rushed to Crozier Medical Center with burns over 80 percent of her body.
Officials said a second woman walked over to the fire department just across the street about 45 minutes later and told them she lived in the home. She had burns to her arm and was also taken to the hospital.
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The shutters from the home next-door melted and fell off from the intensity of those flames. The fire chief said things could have been much worse.
"There was a lot of fire when crews first arrived. They made a good knock on the fire," said Five Points Fire Company Chief Tom Manley. "They stopped it from spreading into house to the right of that location."
And though first crews helped save the home next door and provided aid to the injured women, they say it was the smoke alarms in the home that likely saved their lives.
Two injured in house fire in Delaware
"The smoke alarm woke up the two people sleeping in the house. They wouldn't have known that there was a fire until the smoke choked them out or the flames burned them, but they got an early warning with the smoke alarms and were able to get out," said Assistant Fire Marshal Michele Chionchio.
The cause of the fire remains under investigation.