Families had to flee in panic from nearby homes as flames devastated the empty building on St Barnabas Place in Deepdale at just after 7pm on Friday.

Up to 200 people could only look on in shock as fire crews from across Lancashire battled to stop the flames spreading to homes and cars.

Witnesses told the Evening Post a gang of youths were seen entering the building and running off minutes before it burst into flames.

Five children - two 15-year-old girls and three boys aged 15, 14 and 13 - spent Friday night in the cells at Preston police station.

They have now been released on bail until August.

Deepdale arson - picture gallery

Fire crews and police evacuated at least 20 homes nearby amid fears the building would collapse.

Flames could be seen shooting 10ft into the air above the fire-ravaged building.

Many residents were taken to the Holiday Inn in Preston.

Firefighters spent most of the night damping down at the site with one crew at at the scene at dawn on Saturday.

Specialist crews were inspecting the safety of the building on Saturday morning.

St Paul's Road between Argyll Road and Noor Street remained closed on Saturday.

Nehraz Ishraf, 28, of Stanleyfield Road, was babysitting her nieces and nephews when she was forced to flee.

She said: "The police turned up hammering on my door telling us to get out."

Greta Stopford, 26, and boyfriend Matthew Johnston had to leave their home at 9pm.

Greta, a funeral director worker, said: "One of our neighbours came and knocked on our door and said we better move our car because the building was on fire.

"Then we were told we had to get out of the house."

She added one of her neighbours had warned a gang of youths seen entering the building to stay away minutes before the fire erupted.

She said: "He told them to get out but they wouldn't listen to him. A few minutes later we saw flames and smoke and the kids were running away."

Neighbours living in the area said the building had previously been student halls but had been empty for the last six months.

Jeff Holden, station manager at Bamber Bridge fire station said firefighters from Preston, Penwortham, Bamber Bridge, Fulwood and Hyndburn had been called to the scene.

He said: "We received a report that youths were seen entering the building and then running away minutes before the fire started.

"Twelve homes were evacuated as we became concerned people could be affected by the smoke.

"The roof of the building has also suffered severe structural damage and started to collapse.

"The first floor of the roof space is badly damaged by heat and smoke and the ground floor also suffered from water damage."

Insp Mark Bridgeworth, of Preston Police, said: "Five children are in custody on suspicion of arson and are being interviewed at Preston police station. They are local to the area.

"The area is being treated as a crime scene and investigation teams will be going down to the building to gather evidence."

Have you been affected by the fire? Do you have pictures or video footage of the incident? Email andy.sykes@lep.co.uk or call (01772) 838107.

>> Vote in today's web poll