Trainee Nathan Mawhinney (17) is pictured keeping an eye on the blaze as other brigade members search the burning house for fake bodies.
Slideshow: Alexandra house fire exercise
Chief Fire Officer Russell Anderson said controlled fires were lit then put out throughout the house during the day before the "grand finale" when they "let it go".
While it was a physically exhausting day for the firefighters, it was a "great" training exercise in search and rescue as well as how to fight house fires.
Three members of the Cromwell volunteer brigade joined the Alexandra firefighters for the exercise under the watchful eyes of two trainers from Dunedin.
Sue Philips, who owned the Walton St house, said it was sad to see it burn but it had to go to make way for a proposed subdivision.
During the exercise, the house was virtually burned to the ground and what was left - some bricks, concrete and the chimney - would be removed by a digger and truck today, Mr Anderson said.