Firefighters toiled overnight in stifling heat to bring under control a massive fire that gutted more than 50 shops in tightly-packed buildings in north Delhi's Chandni Chowk area.

Flames were still simmering under some collapsed portions of buildings and a cooling operation is underway, officials said on Friday.

The fire broke out in Chandni Chowk's Old Katra Marwadi Market around 5 pm on Thursday. There were no casualties.

Delhi Fire Services (DFS) chief Atul Garg said the fire was brought under control at 4.30 am.

"Eight fire tenders have been deployed for the cooling operation. Over 50 fire tenders and 200 personnel worked through the night to control the blaze," he said.

More than 50 small and big shops were gutted in the fire, he added.

Two buildings housing multiple shops, including the one where the fire started, collapsed due to the blaze. Small fires are still simmering in combustible items under the debris, Garg said.

The shops that were gutted sold sarees, dupattas and other combustible items, according to officials.

Deputy Commissioner of Police (North) M K Meena said forensics and electricity departments will conduct an inspection after the cooling operation is complete.

An FIR is being registered in the matter, he said.

Another officer said the fire broke out due to a short circuit in an air conditioner in a shop on the second floor of one of the buildings and it quickly spread to other shops.

Firefighters struggled to douse the flames as shops are interconnected in the narrow lanes of the old Katra Marwadi Market, he said.

Nai Sadak Traders Welfare Association president Deepal Mahendru said the number of damaged shops may go up to 100.

He said due to the heat, traders are scared to go inside their shops.

"Once the cooling operation and inspection are completed, we can calculate the losses. They will be in crores," he said.