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Tyne & Wear Fire and Rescue Service responded to reports of the blaze in the Durham Road area.
They have urged residents to keep windows and doors shut.
Northumbria Police Road Safety took to social media to warn drivers of the many diversions in place due to the fire.
They wrote on Twitter to their seven thousand followers: “Large fire on the A167 Birtley is closed.
“This impacts on the A1 diversion southbound at the Angel of the North.
“The diversion is back north to the A184 through Gateshead ,A19 south.
“An evolving situation, Officers are located at key points to assist with the diversion.”
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