The fire erupted at a Staumuhle refugee compound located in North Rhine-Westphalia, Neue Westfalische reports. Some 110 firefighters and around 90 rescue workers from several departments have been called in to tackle the blaze.
A picture posted on the website of the news outlet showed a one-storey house with huge plumes of smoke coming out of it.
More than 50 people have been treated for smoke inhalation, the outlet adds citing officials.
The building is part of a refugee facility in the community of Staumuhle, housing 497 asylum-seekers.
On Tuesday, police were called to the same refugee compound to stop a reported fight involving dozens of people, Neue Westfalische reports. Police detained four suspects, the outlet says citing investigators.
A massive brawl involving dozens of refugees at the facility was also reported in May of last year. Several people received minor injuries.