The Dubai government media office tweeted that a "fire has been reported in the Address Downtown hotel.
Authorities are currently on-site to address the incident swiftly and safely".
The head of the emirates' civil defence forces, Rached al-Matruchi, told Dubai-based Al-Arabiya television that the blaze did not cause any casualties.
The 63-storey building was engulfed in flames across several storeys as sirens wailed and helicopters hovered overhead, according to witnesses.
Witness Raphael Slama told AFP that the fire started at around 9.30 pm and rapidly spread upwards across dozens of floors.
"People are being evacuated," he said.
The hotel is close to the Dubai's iconic Burj Khalifa, the world's tallest skyscraper. Dubai authorities said earlier that they had deployed thousands of security personnel to ensure visitors and residents could enjoy the New Year's festivities safely.
The emirate had promised a "spectacular" fireworks display that was set to kick-off at midnight from the Burj Khalifa before spreading to various locations across the city.
A spokeswoman for the Dubai government said on her Twitter account said the celebrations would go ahead "according to schedule" despite the fire.