Police took Chanthy Mao, 27, identified as a recent immigrant from Cambodia, into custody after she underwent a psychiatric evaluation at the Hospital of the University of Pennsylvania, The Philadelphia Inquirer reported.
Police responding to a call of a disturbance Wednesday evening found Mao's 8-year-old son and 12-year-old daughter with multiple stab wounds in the family's apartment.
Both children were pronounced dead at the scene, the Philadelphia Daily News reported.
Police said Mao admitted to stabbing the children and was "acting irrationally."
A neighbor said the family moved to South Philadelphia from Cambodia about a year and a half ago to join the children's grandfather, who obtained political asylum in the United States five years ago.
"It's very shocking and surprising," said neighbor Chea Meas, a social worker. "It seemed the mother was perfect and very nice. I don't know what would lead her to kill her children."
Mao was awaiting an initial court hearing on murder charges, authorities said.