East Sussex Fire and Rescue Service said it was called at 8.44am this morning to Chandlers Building Supplies in Basin Road North, Portslade.
It initially sent out six fire engines from Hove, Shoreham, Roedean and Newhaven along with a further two from Preston Circus. But there are now ten fire engines at the scene, with crews from Lewes and Newhaven, along with two aerial ladder platforms from Preston Circus and Worthing.
Police have sealed off the seafront road around Shoreham Port, and have warned residents in the Kingsway area to close their windows and avoid the area.
Mike Fielder, of Feedwell Cafe, said: “I saw thick smoke. It was horrendous. it’s a good job the wind is blowing that way, not this way.
“The panic was that there was gas and bottles around.”
Colin Smith and Russell Wickins, dry liners at CCR Dry Lining, were working on the third floor of a building overlooking Chandlers when they saw smoke.
Mr Wickins said: “When the smoke come out we went up to the penthouse floor. All the firebrigades were there, nobody was injured.
“Then the police told us to evacuate.”
Martin Dean, from Millerbourne Architects, said his office was also evacuated.
“We heard an explosion, a boom,” he said. “We didn’t know what was going on, we couldn’t see it.
“You hear a lot of noises from the port round here.
“But as we walked along we saw the flames and the big billowing black smoke.”
Amy Gordon, who also works at Millerbourne architects, was in the office at 8am this morning.
She said: “Sometime after that I heard an explosion, I looked out of the window and saw plumes of black smoke.
“Police came in and said we needed to evacuate. They were mostly worried about gas canisters and things.
“There was lots of black smoke.”
A fire service spokesperson said: "Crews continue to tackle a serious fire at Chandler Building Supply’s, Basin Road, North Portslade. There are now ten fire appliances in attendance, a further two have been dispatched from Seaford and Worthing.
"Efforts are being made to surround the fire.
"Police, fire, ambulance and port authorities are in attendance.
"Crews continue to tackle the blaze.
"Due to large volumes of smoke in the Portslade, boundary area, the public are being advised to keep windows closed and to avoid travelling into the area if possible. Traffic around the area is extremely busy and Sussex Police have implemented road closures around the area."
A statement from Chandlers Building Supplies said: “Firefighters are currently at the Brighton branch of builders merchants, Chandlers Builders Supplies located at Basin Road North, Aldrington Basin, Portslade.
"The Chandlers Building Supplies Brighton branch will be closed today.
“The fire service is working at getting the situation under control. It appears that the fire started early this morning. We do not know any further details at this stage. Most importantly, nobody has been harmed or injured."