The fire at the premises, shut down for the past four years, was first noticed at around 2 AM, a fire official said.
26 fire engines were pressed into service and fire fighters fought for nearly two hours to bring the blaze under control.
However, none was injured in the inferno, the exact reason of which is yet to be known.
Chandni Chowk is the central business district of the city.
Jyoti was built in the 1930s and was a favourite with film aficionados as it screened 700 mm films since the 1970s. Hindi films and Hollywood films used to be screened regularly in it.
The theatre had created records of sorts with the evergreen blockbuster 'Sholay' running in it for 103 weeks.
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