"We have begun a large-scale search between Morges and St Prex," close to the western city of Lausanne, local police spokesman Jean-Christophe Sauterel told AFP. More than 140 police were taking part in the search, he added.
No trace has so far been found of six-year-old Livia and Alessia Schepp since they disappeared at the end of January along with their father Matthias.
He later threw himself under a train in southern Italy after having sent a letter to his estranged Italian-born wife in which he told her he had killed the fair-haired girls and that they were "resting in peace in a quiet area."
Sauterel said the new search was triggered by new eyewitness testimony that emerged last week.
"We have a statement from someone who came to the local police headquarters on April 6 and who told us about a man who was seen carrying a suitcase in the Boiron region (near Morges) on Sunday, January 30, around 4:00 pm," said Sauterel.
"That is all we have from this witness, but by linking the new information to other elements of the investigation, we have deemed it relevant and decided to conduct this search with dogs who are trained to find bodies," he added.
Eleven dogs are taking part in the search.
Swiss, French and Italian police have all been involved in the search for the twins ever since Schepp, a Canadian-born Swiss, failed to return them to his estranged wife Irina Lucidi on January 30 after picking them up two days earlier for the weekend.
The parents were a high-flying couple who worked for the tobacco giant Phillip Morris and who had separate homes in the quaint village of Saint-Sulpice on the shores of Lake Geneva in Switzerland.
At one stage, the focus of the search switched to Corsica after the girls were apparently spotted with their father on a ferry to the island from mainland France on January 31.