About 80% of the island, which was about 500m in diameter, has been burnt by the fire, which started about 6pm on Saturday.
Lake Tekapo Deputy Chief Fire Officer Debbi-Kaye Gardner said the blaze had shocked residents, as Motuariki Island had spiritual and historic significance to many people in the area.
''It has different meaning for different people and locals are pretty stunned. Even quite toughened firefighters were moved by it,'' she said.
It was believed a camp fire had been lit on the island, despite a fire ban on the Doc reserve land, which is vegetated with old pines and native plants and inhabited by lizards.
Doc South Canterbury district partnerships acting manager Sally Jones said police and the department were investigating the cause of the blaze.
It had been reported that three Christchurch construction workers from the United Kingdom lit a camp fire on the island, but Ms Jones could not confirm that.
The fire was likely to smoulder for days and possibly weeks, she said.
Doc would keep a close eye on the island, to make sure sparks did not spread across the lake to the mainland.
''It may be safe to smoulder, given that it's an island surrounded by deep lake water.
''Although it's not close to the shore, there is always a risk in high wind of it sparking on the shoreline, so we will keep a very active eye on that, with the help of Coastguard and locals in the community,'' Ms Jones said.
She praised the efficiency of Lake Tekapo firefighters, others from various rural fire crews in the area and Lake Tekapo residents who responded to the incident.
''They were amazing. They were at the island within 40 minutes and were pumping water from the lake. The locals rallied together and got their own boats to go over and helped out where it was safe to do so,'' she said.
A helicopter with a monsoon bucket was also used on Saturday night, but the island's dense covering of pine needles in certain areas meant parts of the fire could not be extinguished from the air.
The island was inspected yesterday, but it was not safe for firefighters to stay there.
