The service said it was called to reports of a fire in North Street at 1.08am on Thursday, March 16.
The fire is at The Angel Inn, according to an eye-witness.
A spokesperson said: “Joint fire control mobilised 15 fire engines, two aerial ladder platforms, two water carriers, an off-road vehicle and [a] high volume pump to the scene.
"Upon arrival firefighters were met with a significant fire in the roof space of the hotel, which has since spread to adjacent properties.
“Firefighters are working hard to bring the fire under control and are expected to be at the scene for a considerable amount of time.”
A relief centre has been set up in Midhurst for those that have been displaced, the fire service added.
Sussex Police said: “A number of people including Ukrainian refugees were safely evacuated from the building and have been provided with temporary accommodation. No casualties have been reported at this time.”
Local residents are advised to keep their doors and windows shut as there is a ‘large smoke plume’ in the area.
The fire service said: “North Street is expected to be closed for some time, so please take this into account when travelling.
“Assistance is being provided by Surrey Fire and Rescue Service, Hampshire and Isle of White Fire and Rescue Service, Sussex Police and South East Coast Ambulance Service.”
Billingshurst Fire Station confirmed on social media that crews from across the county were tackling the ‘significant’ fire.
The fire service said it is too early to know what caused the blaze but an investigation will be carried out when it is safe to do so.
A police cordon remains in place as a precaution and local traffic is being diverted.
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1. Midhurst hotel fire
Midhurst hotel fire Photo: Eddie Mitchell
2. Midhurst hotel fire
Midhurst hotel fire Photo: Eddie Mitchell
3. Midhurst hotel fire
Midhurst hotel fire Photo: WSFRS/Eddie Mitchell
4. Midhurst hotel fire
Midhurst hotel fire Photo: Eddie Mitchell