Residents of Canterbury's Castle Hill village were encouraged to evacuate before nightfall Thursday as a 535-hectare scrub fire at Bridge Hill continued to burn out of control.
Incident Commander Brian Keown says it is possible - but not probable - the blaze will reach the village overnight.
Health New Zealand has also issued a public health warning for smoke from the fire.
Nine helicopters, three planes, and 12 trucks, tankers and support vehicles were among the resources thrown at the blaze.
Three school camps staying about a kilometre from the fireground were earlier evacuated as a precaution, as was Flock Hill Lodge.
State Highway 73 is closed between Castle Hill and Arthur's Pass village.