The ACT faces another day of dangerous bushfire conditions as a blaze raging south of Canberra is expected to cloak the capital in choking smoke.

Firefighters were on Tuesday night bracing to defend properties as embers from the more than 8000-hectare Orroral Valley fire started spotting near Tharwa village, 30 kilometres south of Canberra.

The ACT Emergency Services Agency said heavy smoke caused by the fire would likely linger in Canberra until midday on Wednesday.

WATCH & ACT - ORRORAL VALLEY FIRE - 29 January 2020, 5:30am https://t.co/BkkgEGV14q pic.twitter.com/iQapZoVJrD — ACT ESA (@ACT_ESA) January 28, 2020

Temperatures are forecast to rise as high as 36C on Wednesday, with the ACT's fire danger rating remaining at "very high".

Authorities predicted the fire could come within one kilometre of the suburb of Banks on Canberra's southern outskirts.

However, on Tuesday night they said the fire posed "no immediate threat to properties in Canberra suburbs".

The warning level remained at watch and act level early on Wednesday morning due to moderate overnight conditions.

Views of the Orroral Valley Fire from just outside the village of Tharwa and further along from the southern Canberra suburb of Banks.



The size of the fire has now grown to almost 8000ha #OrroralValleyFire@SBSNews pic.twitter.com/drpQKpsPpl — Nakari Thorpe (@nakarithorpe) January 28, 2020

Community members of Tharwa, Boboyan Road, Apollo Road, and Top Naas Road were told to remain vigilant while residents of Banks, Gordon, Condor, Calwell and Theodore should continue to monitor conditions.

Operation Bushfire Relief's Lieutenant General Greg Bilton told reporters on Tuesday evening a defence reconnaissance helicopter was believed to have started the fire.

Authorities said the blaze was the most serious Canberra has faced since the deadly 2003 fires.

The community of Tharwa nestled at the bottom of these hills is being urged to evacuate as the Orroral Valley Fire burns out of control in the Namadji National Park #OrroralValleyFire @SBSNews pic.twitter.com/hTvmtg8DVa — Nakari Thorpe (@nakarithorpe) January 28, 2020

Caloola Farm manager Ralph Hurst-Meyers was desperately trying to convince three men still on the farm near the blaze to leave as they planned to defend the property.

"It just looks like a dragon, it's unbelievable. It's like a mushroom cloud with a red eye," Mr Hurst-Meyers told AAP on Tuesday.

He said firefighters had told him the farm would become a trap if the fire reached there and said it was too dangerous to defend it.

Mr Hurst-Meyers said he had been in Canberra for the catastrophic 2003 bushfire and he'd learned it wasn't worth holding your ground.

"I know what the beast looks like. I've seen this before. This is a shocker," he said.