The 80-year-old Tokyo market is known for its daily tuna auctions, which supply many of the capital's top sushi restaurants.
Smoke could be seen billowing from the market as dozens of fire engines tackled the flames on Thursday.
There are no reports of serious injuries at this stage.
The fire broke out at about 16:50 local time (07:50 GMT), Japanese broadcaster NHK said, in the outer region of the market and close to the surrounding area's narrow streets.
The area is home to many sushi restaurants and shops, some of which have been evacuated, NHK reports.
Tsukiji's interior, more industrial market - where the famous tuna auctions take place - was undamaged, according to new reports.
The cause of the fire is not yet known. The blaze seems to have affected several old wooden buildings.
The market was constructed in 1935, in the aftermath of the great Kanto earthquake of 1923, and built largely from corrugated iron sheds.
Today, it is a sprawling, busy market - but one that the BBC's Rupert Wingfield Hayes in Tokyo described as "old, rundown, dirty and overcrowded".
Nonetheless, its enormous volume and variety of produce means it receives tens of thousands of tourist visitors each year.
The market is, however, due to be moved by the end of 2017.
Efforts to move the market to a more modern location have been met with resistance by many of the workers, some of whom have been in the family business for generations.
Tokyo's governor, Yuriko Koike, has previously said the market needs to be rebuilt because of its age - and the associated risk of it being vulnerable to earthquakes, which are not uncommon in Japan.
Photo caption: Dozens of fire engines battled the blaze at Tsukiji