Residents around the Moorebank factory fire in Sydney’s south-west are being urged to remain inside and keep their windows closed amid warnings about a strong odour which could be hazardous.

More than 100 firefighters were called out yesterday afternoon when the factory caught alight, causing an inferno of huge flames and thick black smoke.

Many residents were forced to flee their homes to stay in evacuation centres overnight after the area was deemed unsafe.

The odour is being caused by a lavender oil tank that was damaged when the factory roof and walls collapsed onto it, fire incident controller Andrew Shurety said.

“We have had firefighters here overnight trying to extinguish the blaze,” he said.

We’re an unable to make internal entry to the building because of the instability of the building and the risk to firefighters is too high.

Firefighters hosing down the Moorebank chemical factory. Photo: Jonathan Hair, ABC News

Some residents have returned home but are being warned to leave if their homes are still affected by smoke.

“When it’s burning, it’s producing some gases that could be hazardous for people to breathe in — if you’re in smoke we need you to leave,” Mr Shurety said.

About 30 to 40 emergency services crews continued to hose down the structure and structural engineers will assess the situation today.

There were people inside at the time of the blaze, Fire Superintendent Rob Jensen said.

“There is cars in the driveway, there were some fire extinguishers laying around at the front of the building,” he said.

“I’m assuming that the place was occupied at the time and someone’s had an attempt to extinguish a fire, and its just gotten too big for them,” he said.

– ABC