The incident involved four cars and two lorries, one of which caught fire after a HGV jack-knifed across the carriageways.
The vehicles involved were travelling north near Bowburn when the collision happened at 6.20pm.
A man driving a Toyota Hilux pick-up died at the scene along with a man and a woman travelling in a Vauxhall Crossland.
They have not yet been named but their families have been informed.
Several others were injured in the collision, with two requiring hospital treatment.
A 41-year-old HGV driver has been arrested on suspicion of causing death by dangerous driving. He remains in police custody.
Due to the complexity of the scene, there is ongoing work to safely recover evidence and remove vehicles which will take some time and the road remains closed.
Detective Superintendent Dave Ashton, who is leading the investigation, said: “This was a harrowing incident for everyone involved and our thoughts are with the family and friends of those who have lost their loved ones.
“It has been incredibly upsetting and distressing for those who witnessed the collision, and for the emergency responders, including police officers, firefighters and paramedics, who attended the scene.
“We would therefore ask that people refrain from sharing photographs and videos from the collision out of dignity and respect for those who have lost their lives.
“This will be an extremely complex and lengthy investigation as the site of the collision is spread over some distance, and many of the vehicles involved have been severely damaged.
“The road will remain closed for the rest of the day to allow for specialist collision investigators to work at the scene and to establish the circumstances surrounding the incident.
“The road will also need to be assessed for damage prior to reopening to ensure the safety of future road users. Therefore, motorists should avoid the area and plan ahead if they need to travel.
“We understand the significant disruption that this incident has caused, and would like to thank people for their patience, understanding and cooperation while we work at the scene.”
An online portal has been set up by police to allow people to submit information in relation to the incident, as well as dashcam footage and photographs.
To submit material, please visit https://mipp.police.uk and click on the Durham Constabulary tile.