It is thought that hundreds of vehicles are currently on fire at Excell Recycling Centre on Moorfield Industrial Estate on Moorfield Road in Altham.
Police and fire services were alerted to the incident at around 4.30am this morning (7 December) and twelve fire crews and 60 firefighters from across the county are currently battling the fire.
A spokesperson for Lancashire Fire and Rescue said: "Crews from Hyndburn were initially called to a fire at a car salvage yard/scrap yard on Moorfield Industrial Estate, Altham at 4.42am.
"A strong breeze led to the fire spreading quickly and crews were joined by six fire engines from across the county.
"A further six fire engines have now joined the team of 60 firefighters who are currently tackling the fire which is involving hundreds of old vehicles.
"Crews are using a high volume pump which is bringing additional water to the site and a hazardous materials unit which is providing specialist support and advice on protecting the environment and public health.
"There is a significant smoke plume and residents are asked to keep their doors and windows closed. People are asked to avoid the area and to take care if travelling in the vicinity."
Early reports suggest that nobody has been injured in this incident.