A gas cylinder reportedly exploded on a construction site near Paddington on Thursday afternoon, say police.
Officers were called to Sussex Gardens at around 1.30pm following reports of an explosion.
Police said extensive road closures are in place and the public are urged to avoid the area.
A spokesperson for the Metropolitan Police said: "At this early stage there are not thought to be any casualties.
"The incident is not thought to be counter terrorism related."
Hannah Beraud, 24, a student lives in apartment opposite the explosion, said: "I was going out of my apartment, I live in Sussex Road just in front of the explosion.
"The road is closed, no one can enter, not even residents as all of us were evacuated.
"We're still waiting now and the Police do not know when we can go back in.
"There is about 20 of us waiting."
It is understood that at around 5pm police began letting residents back in Westbourne Terrace.
A spokesperson for London Fire Brigade said: "Crews have been called to an acetylene cylinder which is alight at a construction site on Sussex Gardens, near Paddington.
"Firefighters are currently cooling the cylinder in order to make it safe. A 200 metre exclusion zone around the cylinder is in place and this is affecting a number of roads in the area including Westbourne Terrace and roads around Sussex Gardens and Spring Street.
"Three fire engines from Kensington and Paddington Fire stations are at the scene.
"The Brigade was called at 1.25pm and are expected to be at the scene for some time.
"The cause of the fire is not known at this stage."
