Firefighters were called to a fire in an accommodation block in the Wellington CBD on Tuesday evening.
Fire and Emergency said the fire on the fifth floor of the Kāinga Ora building was being treated as suspicious.
Emergency services were alerted to the fire in Church Street at 6pm.
Senior station officer Steve Mackle said the fire was contained by the sprinkler system and extinguished by firefighters.
Mackle said they did not know how it started, but FENZ staff and police would investigate.
Residents have been evacuated from the nine-storey building.
"There's still toxic gases and smoke on some of the floors. We're ventilating that at the moment, getting rid of the smoke and gases, and once we can confirm that it's safe we're going to let people back in," Mackle said.
There were no reports of injuries.
Seven fire trucks were sent to the scene.
Two people were injured after an explosion in the same building which is leased by Kāinga Ora in March.
It contains 100 apartments.
One of the injured was a firefighter.