Six fire engines and around 40 firefighters tackled a fire at a waste recycling plant on Devon Street in Southwark.
Crews arrived and discovered a developing fire in around 300 tonnes of waste situated within a single-storey tipping hall. Around 100 people left the site before firefighters arrived and there have been no reports of any injuries.
Although the fire was contained within a building, people in the area were advised to keep their windows and doors shut due to possible smoke travel.
Incident Commander Tom Ronan said: "Firefighters worked hard to extinguish deep-seated pockets of fire within a pile of waste. We also worked closely with the site operator to put out the blaze with staff using shovel loaders to remove piles of recycling.
"Firefighters remained on the scene into the evening to fully extinguish the fire."
The most probable cause of the fire was the failure of a lithium-ion battery in the waste.
A London Fire Brigade spokesperson said: "Lithium batteries and electricals with hidden lithium-ion batteries should not be placed in the same bins as your regular rubbish or recycling. Instead, check with the retailer or your local authority's website for the safest way to dispose of lithium-ion batteries in your area and reduce the risk of fires occurring.
"Lithium-ion battery fires are a major risk. We’ve seen a growing number of fires at waste disposal sites that are believed to have been caused by a lithium battery.
"Although lithium-ion battery products that have been built to a poor standard are a higher fire risk, any battery is at risk of exploding and catching fire if it has been crushed or becomes damaged. Lithium-ion battery fires can be ferocious and can spread in seconds.
"Fires that we attend at sites like recycling centres and scrap yards can be very time consuming for our firefighters and often require a high level of resources to put the fire out. We’ve also seen the detrimental environmental and societal impact these fires can have on local communities."
Control Officers took the call at 1231 and mobilised crews from New Cross, Old Kent Road, Peckham and Deptford fire stations to the scene. The fire was brought under control by 1746.