More than 60 firefighters were called to battle the fire at a single-storey factory on Northcorp Boulevard and Camp Road, Campbellfield, which ignited shortly after 8pm.

A police helicopter spotted the blaze while on routine patrol. "The factory appeared completely engulfed in flames and surrounding grass alight," a police spokeswoman said in a statement.

The fire, which a Metropolitan Fire Brigade spokeswoman said involved fuel drums, was deemed under control around 10.30pm, but fire crews remained at the site overnight, the spokeswoman said.

No one was injured, but a number of people were evacuated from nearby businesses as a precaution.

The blaze gutted the factory but did not spread to nearby buildings.

An updated Watch and Act alert was issued at 10.39pm to residents in Broadmeadows, Campbellfield, Fawkner and Glenroy, advising them to close their windows and doors and turn off their airconditioning due to the amount of heavy, black smoke in the area.

A crime scene has been set up and detectives and an arson chemist are investigating. The fire is being treated as suspicious and the arson squad had been called in, a police statement said.