Central Queenstown has been brought to a standstill as a result, with roads closed, and nearby hotel guests have been evacuated.
Emergency services are in attendance, and roads around the area are closed.
A Fenz spokesman said six appliances and aerial appliances are responding along with additional support vehicles.
Waka Kotahi NZ Transport Agency has said that due to the fire on Stanley St, the road is closed at Ballarat St.
Motorists are being asked to follow the directions of emergency services on-site or avoid the area.
Eye-witness James Allan said the fire started “pretty small” and multiple alarms were triggered as a result of smoke.
“Then suddenly poof, the whole building just burst into flames and it’s now pretty significant,” he said.
“This is in the centre of the city and the entire town’s stuck. Buses and trucks unable to move, startled tourists and locals who have been evacuated from hotels and apartments just looking on.”
It is unclear if it is just the Speight’s Ale House on fire, or if other buildings are also affected.
Allan said there were upwards of 20 fire officers seen attending to the fire.
“The fire is huge now, and smoke can be seen across the whole town,” Allan said.
