The fire broke out at 2.30 pm in the busy market in old Delhi, a fire official said.
No casualties have been reported so far.
A Delhi Fire Service official said the fire was reported from Kinari Bazar -- a wholesale retail market specialising in wedding attire and accessories.
Around 16 fire tenders were rushed to the spot to douse the fire after it was reported at 2.30 p.m.
According to initial reports, the fire was caused due to a short circuit in a transformer and was soon brought under control.
It is also being speculated that a blast in transformer may have led to the fire.
Meanwhile, 16 fire tenders are battling the blaze.
According to TV reports, narrow streets and bylanes are hampering the rescue operations in Chandni Chowk.
Earlier in the day, a massive fire broke out in a building in Connaught Place area. The fire broke out at NIIT centre located in Rama building. Fifteen fire tenders were rushed to the spot to douse the fire. [Read more]
Delhi: After fire in CP, 10 shops gutted in Chandni Chowk fire http://t.co/QivAVxOMh5— CNN-IBN News (@ibnlive) August 25, 2014