No causalities have been reported so far.
Fire department officials said that around 27 fire tenders were rushed to the spot to douse the flames.
"Fire was reported at 8.30 AM and fire tenders were immediately rushed to the spot. Plastic and wood kept in an open yard in the area also fuelled the fire," said A K Sharma, Director of Delhi Fire Service.
Heavy smoke filled the area as the blaze spread and small cylinders kept in the jhuggis exploded.