Residents in parts of Dallas, in Melbourne's north, are being evacuated after a massive fire at a recycling plant has sent smoke and ash falling across neighbouring suburbs.

Key points: Emergency warning in place for parts of Dallas due to smoke

Emergency warning in place for parts of Dallas due to smoke Fire crews working to control smoke with foam

Fire crews working to control smoke with foam Blaze broke out in a large pile of paper and plastic

About 50 trucks were earlier on the scene battling the blaze which broke out in a large pile of paper and plastic at the factory in Maffra St, Coolaroo just before 9:00am.

Just after 8:00pm, emergency services put out an emergency warning to residents in parts of Dallas after the state's Environment Protection Authority said air quality near the plant was "very poor" due to smoke.

Incident controller Mark Swiney said there were about 115 houses in the evacuation area.

"The fire is burning pretty profusely and giving off a lot of smoke. That smoke is heading in a southerly direction and we've actually activated an evacuation to the south of Barry Road in Dallas," he told ABC Radio Melbourne.

"[Residents] can evacuate themselves or they can wait for police and SES to doorknock the area and they can assist with evacuation.

"People will be out of their houses tonight and we'll re-assess the situation tomorrow."

A relief centre has been established at the Broadmeadows Aquatic Centre.

Emergency services said the warning affected residents in the following areas:

Barry Road between Dallas Drive and Doy Street

Barry Road between Dallas Drive and Doy Street Washington Street between King and Doy streets

Washington Street between King and Doy streets Edmund Street between King and Doy streets

Edmund Street between King and Doy streets Doy Street between Barry Road and Edmund Street

Doy Street between Barry Road and Edmund Street Dallas Drive to Sale Court, including Sale Court

A map of the streets around Dallas covered by an evacuation order due to poor air quality. ( VicEmergency )

Earlier Metropolitan Fire Brigade (MFB) commander Ken Brown told those at a community meeting in Broadmeadows this afternoon that it could take crews up to three days to put out the blaze.

"The first estimates were that this fire would go for 24 hours," he said.

"Once I've had a good look at this fire it could be up to three days before we extinguish [it].

"It's a very deep-seated fire. That brings about a complexity within itself.

"The only way you're going to put that out, once you control the smoke, is to pull the piles apart. It's a limited space area so that makes it difficult to manoeuvre stuff around."

Residents reported ash falling as far as away as Kensington, about 15 kilometres away in Melbourne's inner west.

People living nearby were warned to close their doors and windows. ( ABC News: Melissa Brown )

A watch and act warning is in place for Broadmeadows, Campbellfield, Dallas, Fawkner, Glenroy, Jacana, Westmeadows and some businesses in Maffra St have been closed.

"Anyone located in affected areas should take shelter indoors immediately," the warning message said.

"Close all exterior doors, windows and vents and ensure that heating and cooling systems are turned off."

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Commander Brown said the priority of fire crews was to control the smoke.

"We're going to introduce foam into the system to try [to] knock the smoke down so the impacts on the community are minimal," he said.

The fire is not under control but is not threatening any surrounding properties.

The smoke could been seen as far away as in the CBD.

Commander Brown said the MFB would work closely with business owners so "ideally" they could return to work on Friday.

Fire crews at the scene say they are battling with water supply problems. ( AAP: Stefan Postles )

Plant site of several recent fires

Commander Brown said there had been a number of fires at the site in recent times, including one about 5:00pm on Wednesday, and the large blaze crew were now battling 12 hours later.

He said fire investigators would look at the cause of the blaze.

"We've got to look at why this has happened," he said.

Earlier in the day, Commander Brown said crews were having problems with the water supply at the blaze.

Flames burned through huge piles of paper at the plant. ( ABC News )

One nearby resident reported getting ash in his eye when he wound down his car window.

Another, an asthmatic, said she was struggling with the smoke.

"The ash and smoke is very bad," she said.

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