A Fire and Emergency New Zealand spokeswoman said there were multiple calls to the fire in Barton St, about 12.50pm.
Initially, two appliances from the Roslyn and Dunedin City stations attended, but the fire was "well involved" and was upgraded to a second alarm soon after their arrival.
Two more fire appliances were sent from Lookout Point and St Kilda stations.
"There were gas bottles in the garage — I’m not sure how many.
"It would be safe to assume that added a level of danger and was an extra factor in the fighting of the fire."
A St John ambulance also responded to the incident to treat a patient with smoke inhalation.
They were transported to Dunedin Hospital in a moderate condition.