Firefighters were called to the Basket of Dreams area at the top of Queenstown Hill at 10pm.
Firefighters asked people to clear the reserve while Department of Conservation firefighters put out the fire, which took until 2am on Tuesday .
Because there was no road access, firefighters had to run 1km uphill to get to the reserve.
A helicopter equipped with night vision equipment was also called to assess the area, while officers made sure the fire, which burnt about 0.5ha, did not spread to nearby houses.
Doc Wakatipu Rural Fire Officer Jamie Cowan said the fire showed people were not getting the message about lighting fireworks in dry areas.
"There were quite a lot of people up there and that was what we were most concerned about. Luckily the wind wasn't too high so it didn't go too far. The benefit was it was at the top of the hill and fire likes to climb."
He said the cause was subject to investigation, but initial evidence pointed towards fireworks use.
The estimated $4000 cost of fighting the fire incurred by the New Zealand Fire Service , the helicopter and Doc would be charged to those found responsible.
Mr Cowan could not say whether the fireworks users would be prosecuted.
"We have the obligation to seek the party or parties responsible and recover costs from them, and we will be doing that."
The area that caught fire requires a fire permit, which he said would certainly not have been be given.
"It's like lighting a fire cracker in a hay barn."
Doc workers stayed overnight at the scene in case of another outbreak and were again cleaning up early yesterday morning.
