Hazardous material and toxins were burning, according to Fire Rescue Victoria, with the Western Freeway closed for several hours near the area for health reasons.
Deputy commissioner Michelle Cowling told reporters at the scene the factory included a warehouse that mixed chemicals and stored drums containing kerosene, fuel, methylated spirits, methanol and others.
The blaze was Melbourne’s most significant in several years and would likely burn for days, she said.
“We’ve got embers burning, fire burning – even with our aerial appliances that are on-site and specialist hazmat people on-site we can’t get in close enough to cool this fire down,” she said.
She said an acrid smell was expected to linger and advised people to stay away from the area over the coming days if possible.
Fire investigators have not yet confirmed how the blaze started but it did not spread to nearby buildings.
One worker died and two were injured in a fire at the same building in October 2023, which was also sparked by an explosion.
Cowling said there was no connection between that explosion and the fire on Wednesday.
The factory is in an industrial park and houses several businesses, with everyone in neighbouring buildings evacuated.
A watch and act alert was issued for residents and workers in several suburbs because of toxic smoke.
“Anyone located in the watch and act warning area should close all windows and doors,” the alert stated.
The Environmental Protection Authority issued an air quality notice and advised anyone with breathing difficulties to ring triple zero.
Drivers in the area were told to keep their windows up to avoid breathing the smoke and not to slow down to view the fire.
Paramedics remain at the scene but have not yet treated any patients.
