The fire in an electrical substation in Victoria Passage, Aberdeen Place near Paddington started around 5.30am.
Many people have shared videos online of the black cloud rising from the fire with over 100 people calling the fire service.
Station Commander Paul Morgan, who is at the scene, said: “This is a very visible fire and there is lots of smoke.
“Residents are advised to keep their windows and doors shut.”
Fire crews from Paddington and Euston fire stations are fighting the flames using one of the Fire Brigade’s turntable ladders and a bulk foam unit.
The cause of the fire is not known at this stage.
An electrical substation was also at the heart of a major fire near Heathrow that shut down the airport earlier in the year, cancelling hundreds of flights.
