Battered by a terrifying earthquake, exhausted from days of battling a spiralling nuclear crisis, and aware that their loved ones were only miles from the crippled facility, the exhausted workers at the Fukushima No 1 plant must have hoped a new day would finally bring respite.

Instead, Tuesday dawned with the outbreak of fire at a fourth unit – the start of a chain of events in which their worst fears appeared to be coming true.

More than 90 hours after the earthquake and tsunami battered Japan's north-east, shutting off the Fukushima plant and halting its cooling systems, workers learned that radiation at the facility had hit a level harmful to human health.

Hundreds of non-essential personnel were shipped off-site after the blaze, knowing that they were leaving behind dozens of colleagues risking permanent damage to their health. The gravity of the situation emerged a few hours later when Naoto Kan, the Japanese prime minister, addressed the nation.

Clad in blue overalls, Kan began by urging people to remain calm. Fire had broken out in unit No 4, radiation had spread, the level was high, and there was a very high risk of further radioactive material emerging. He asked anyone remaining in the 20km (12-mile) evacuation zone around the plant to leave immediately, and those within 30km to stay indoors. But it was the workers who were "putting themselves in a very dangerous situation" to try to contain the problems, he acknowledged.

Chief cabinet secretary Yukio Edano revealed that a containment vessel might also have been damaged at reactor No 2, increasing the risk of a radioactive leak.

While both men called for calm, behind the scenes there were signs of the government's plummeting faith in the plant's operators, the Tokyo Electric Power Company. Kan was overheard reading the riot act to executives for failing to inform him of the blast, Japanese media said.

"The TV reported an explosion, but nothing was said to the prime minister's office for more than an hour," the Kyodo agency quoted Kan as saying. "What the hell is going on?"

Kan, who had already announced he would take personal control of a new joint-response headquarters involving the power company and the government, reportedly warned Tepco of serious consequences should it decide to pull its workers out before the plant has been made safe. "In the event of a withdrawal, I'm 100% certain that the company will collapse," he said. "You must be determined to solve this."

Between 50 and 70 employees – now known in English as the Fukushima 50 – all in protective gear, were left at the plant to battle myriad problems. Some are assessing the damage and radiation levels caused by the explosions, while others cool stricken reactors with seawater to try to avert a potentially catastrophic release of radiation.

The workers are the nuclear power industry's equivalent of frontline soldiers, exposing themselves to considerable risks while about 800 of their evacuated colleagues watch from a safe distance. Fifteen people on the site, including members of the self-defence force, have been injured in the blasts.

The fire appears to have been the biggest culprit in the release of radioactive materials. By 10.20am, readings at the plant had reached 400 millisieverts per hour in one spot and 100 millisieverts in another, although they were much lower in other areas of the facility.

An NHK expert spelled out what that "very grave situation" meant for the workers. A level of 100mSv per hour could cause infertility in men without protective gear within a short time, for example – though other experts suggested any affected technicians should recover from ill-effects because they would be withdrawn if they had been exposed to high levels. The International Atomic Energy Agency (IAEA) said later that 150 workers had been monitored for radiation levels, and 23 had undergone decontamination.

At midday, there was one welcome victory as workers extinguished the fire at unit No 4. The priority switched back to cooling operations at reactors 1 to 3. But by late afternoon, there was a fresh blow. Kyodo reported that the spent nuclear fuel pool at Unit 4 might be boiling, with the water level falling sharply.

Experts had already warned such a problem could be far more serious than a meltdown in the reactor cores, because they are not shielded by containment units. By 7pm, Japan's nuclear agency was warning there were two eight-metre holes in the outer building of the unit.

The UN's nuclear watchdog reported that radiation levels appeared to be dropping, with readings at the main gate falling from 11.9mSv per hour at 9am to 0.6mSv per hour by 3pm. But six hours later, Kyodo reported that radiation levels inside the control room for the No 2 reactor were too high for the engineers to stay there for long periods. Instead they were working in rotations to avoid contamination, and monitoring the cooling efforts from less hazardous locations inside the plant.

As the day wore on, the Japanese public's admiration for the anonymous workers contrasted with mounting criticism of their employer.

The governor of Fukushima, Yuhei Sato, reportedly told Kan that residents are angry and about to reach breaking point. Tepco officials' vague answers at a morning press conference hit whatever confidence in the company remained.

Tepco has a history of covering up safety issues. In 2002, seventeen of its reactors were shut down and the firm's senior management resigned after it admitted hiding problems and obstructing inspections.

The Japanese nuclear industry says it has cleaned up its act in the wake of that and other scandals. The government at least appears to have learned some lessons. After the Tokaimura disaster of 1999, in which two people died and several hundred people were exposed to radiation, officials initially rejected offers of help from the IAEA.

This time they have sought help from the UN's nuclear watchdog and the US. Yet the IAEA seemed short of information more than 18 hours after the blaze broke out in unit No 4.

"The IAEA is seeking clarification on the nature and consequences of the fire. The IAEA continues to seek details about the status of all workers, reactors and spent fuel at the Fukushima Daiichi plant," it noted in a statement.

With midnight approaching, the agency said it remained concerned about the plant. Workers continue to battle through the night, injecting seawater to cool the reactors in units 1, 2 and 3. Few can be feeling optimistic about what the new day will bring.