The fire started about 8:30 a.m. on Oxford Loop in Princeton, which is in Collin County.
Video from SKY4 showed heavy damage and smoke pouring from the roof of the one-story home.
Princeton officials said the victims suffered some burns as they made their way out of the house. Both Kobi Scott and her daughter, Reagan, were taken to the hospital and later released the same day.
Sadly their 10-year-old poodle named Huck died in the fire, the relatives said.
"Very sad to know that they have to start over. Everything they had and owned was in there ," said cousin Jaime Massey.
The exact cause of the fire is still unknown, but the teen told firefighters she saw the Christmas tree on fire. It's unknown how the tree caught fire.
"Get them out," said Princeton Fire Chief Tom Harvey. "Doesn't take much of a heat source to ignite a dry Christmas tree."
Nearby family members are helping the fire victims out.