A murder investigation has been launched after a two-year-old boy died after suffering severe head injuries.

Kyle Fisher - described by one neighbour as "always smiling and laughing" - lost his fight for life two days after being rushed to hospital.

His 19-year-old mother together with a 34-year-old woman have been arrested in connection with the death and released on police bail. Last night police stressed that detectives are not looking outside Kyle's circle of carers for the killer.

Detective Inspector Tony Hutchinson, of Cleveland Police's Murder Investigation Team, said: "We want to stress that there is no suggestion that anyone unknown to Kyle did this. We don't want people scared there's an indiscriminate child killer on the loose."

The death has shocked the close community on the Central Estate, Hartlepool, where Kyle lived.

One mother-of-three regularly saw him playing in the street where he often stayed with a baby sitter.

She said: "He was a normal happy little boy, always smiling and laughing. You would see him in the garden, he was playing all the time.

"He didn't seem troubled or anything and you would never have thought this could happen to him. Everyone on the estate is just shocked."

Police said that Kyle's female baby sitter called the ambulance service late last Wednesday saying he had collapsed at her home.

The only child was taken for emergency treatment to the University Hospital of Hartlepool.

A few hours later, early on Thursday morning, he was transferred under police escort to the paediatric intensive care unit of Newcastle General Hospital. He died on Friday afternoon.

Police have been investigating since Kyle was first taken to hospital but launched a murder enquiry yesterday after a post mortem confirmed he had suffered severe head injuries.

Kyle's mother, 19-year-old Clare Fisher, of Troutpool Close, and mother-of-two Susan Spencer, 34, of Millpool Close, who is originally from Yorkshire, have been arrested in connection with his death and released on police bail pending further investigations.

Speaking after a press conference at Cleveland Police's headquarters in Middlesbrough, yesterday, Det Insp Hutchinson said members of Kyle's family were distraught.

However he said that police were not looking outside Kyle's circle of carers for the killer.

Detective Inspector Michael Wall, a child protection specialist, is leading the investigation.

He said: "We are determined to find out how Kyle suffered his head injuries. Medical experts are working with us to determine when his injuries were caused and how they were caused."

Forensic tests have been carried out at three homes on the Central Estate in Hartlepool. The house where Kyle's collapsed body was found was still being scoured by police yesterday and police officers were also making house-to-house inquiries. Operations were being co-ordinated from a police caravan outside the house.

Tributes and messages of condolence have been left outside Kyle's home. Amid the teddy bears, toddler reading books and flowers one message read: "To our friend Kyle, good night and God bless, we will always have you in our hearts."

Police are anxious to trace a taxi driver who picked up a 19-year-old woman between 11pm and midnight near the Bar Paris - 42nd area of Hartlepool last Wednesday and took her to the University Hospital of Hartlepool.

Police are also appealing to anyone who knew Kyle and the people he was with in the days before his death to contact them on (01642) 302126.