The Metropolitan Fire Brigade (MFB) has enlisted the help of Victoria Police in its investigation of Thursday's factory fire in Footscray, after determining the cause of the fire may be suspicious.

Key points: Victoria Police called to investigate Thursday's factory fire in fire, which the MFB says "may be suspicious"

Victoria Police called to investigate Thursday's factory fire in fire, which the MFB says "may be suspicious" The fire was still smouldering on Saturday, but had been brought under control on Friday

The fire was still smouldering on Saturday, but had been brought under control on Friday MFB says the potentially-harmful smoke, which was believed to have contained dangerous chemicals, has "significantly dissipated"

Thick, black smoke could be seen streaking across the skyline of Melbourne's western suburbs from early in the morning, when the factory and warehouse in the gentrified suburb of West Footscray went up in flames.

While the cause of the blaze remains unknown, the MFB released a statement on Saturday afternoon saying it had made the decision to hand the investigation over to police.

"After three days gathering evidence at the site MFB specialist fire investigators have made the determination today to refer the investigation to Victoria Police," the MFB statement read.

"This is based on evidence which indicates that the cause of the fire may be suspicious."

The potentially-dangerous smoke billowed over Melbourne's western suburbs. ( AAP: David Crosling )

On Friday, the ABC revealed the factory in question was owned by Christopher James Baldwin, a Shepparton accountant who had recently been the target of massive raids by the Australian Tax Office.

The fire was brought under control on Friday, but was still smouldering on Saturday.

"Smoke from the fire has significantly dissipated thanks to the efforts of firefighters, and the community is advised to go about their daily business but limit their exposure to any smoke which may be evident in the area," the statement read.

The fire started about 5:00am on Thursday. ( ABC News: Zalika Rizmal )

The presence of some harmful chemicals within the factory was of great concern to the MFB, who on Friday had advised residents to stay clear of the area and avoid water from the nearby Hobsons Bay amid fears of contamination.

The storage factory that caught fire contained a chemical called acetone, which is a colourless, flammable liquid used as a nail polish remover and a solvent in paint.

The factory also contained acetylene, which is a gas used for welding and can be highly explosive.