A 12m-high pile of 1600 tonnes of scrap metal, including old cars part, roofing and tyres, is burning at Sims Pacific Metals in Favona.
Fire and Emergency New Zealand area commander Geoff Purcell said the "deep-seated" fire could burn all day.
"It's a huge fire and there's a lot of really thick, black smoke coming from it.
"We are doing everything we can to get this fire under control, and our crews are working extremely hard.
The fire was covering an area 100m by 70m, and 12m high in some places, he said.
"Before the cars were shredded they were drained of fuels and oils, but there are still some minor explosions going off, in tanks, bits and pieces within scrap heap."
The fire was reported at 1.56am.
Nobody has been injured in the blaze, the cause of which was unknown.
Witness John Caldwell said the smoke was "toxic".
"It is affecting breathing. The fire department won't advise if it is or not."
Another witness said the pile of scrap metal was about 12m high. "It is a huge fire - too hot to stand around.
"I could feel the heat from about 100m away."
James Fletcher Drive is closed between Savill Drive and Kaka St.
Mr Purcell said the fire would cause significant disruption to traffic.
"People should avoid the area if they can and close their windows from the smoke.
"Some businesses may also be affected by the cordon.
"We understand that this will cause disruption in South Auckland, and we want to assure people that our firefighters are giving 100 per cent to getting it under control."
