About 50 people were forced to evacuate an apartment building overnight after an e-bike rental shop burst into flames in Sydney.

The blaze was sparked on Shepherd Street in the inner-city suburb of Chippendale before 1am today.

Firefighters arrived to find smoke issuing from the front roller door of the shop. 

The blaze was sparked on Shepherd Street in the inner-city suburb of Chippendale before 1am today. (Nine)
Firefighters said the source of the fire could be a lithium-ion battery that was on charge. (Nine)

About 50 people living in apartments above the shop were forced to evacuate as firefighters battled the flames.

Firefighters said the source of the fire could be a lithium-ion battery that was on charge.

The battery was removed and placed in water as the fire was extinguished and residents returned to their homes.

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