Iraqi and US officials said that there did not seem to have been any casualties from the blasts, which lit up the night sky and unleashed a loud barrage of detonations audible several kilometers (miles) away.
Lieutenant Colonel Jonathan Withington of the 4th Infantry Division said that information on the cause of the fire would be released later. "I believe it's still burning," he added, 11 hours after the fire broke out.
He said that military and civilian personnel had been evacuated from Forward Operating Base Falcon without injury.
Abu Sajad, who lives near Camp Falcon, said that "at the beginning we heard an ordinary explosion. We thought the Americans had fired at something, but I went out of the house and saw fire from inside the base.
"The explosions got stronger and stronger. Two window panes were broken in my house. Rockets were flying here and there, some of them far away. The fire went down then renewed again. Then there was a big explosion.
"We could not sleep all night. We went into two rooms in the middle of the house for safety. My brother put cotton wool in four of the children's ears. We hugged them to comfort them.
"When I left this morning. I asked about the neighbors and, thanks be to God, none of them was harmed."
Withington said: "An ammunition holding area caught on fire. It's in our operating base in the Rasheed area of the city. The ammunition holding area contains tank and artillery rounds as well as small arms ammunition."
The blaze broke out at around 10:40 pm (1940 GMT) Tuesday and shortly afterwards the already shell-shocked city was stunned by one of the most powerful strings of explosions since the US-led invasion of March 2003.
Government spokesmen appeared on state television to urge calm and quash rumors that the city was under attack.
Iraqi officials said that shells "cooking off" in the fire had crashed down in five areas in the south of the city, but the interior ministry said that there did not seem to have been any casualties outside the base.
State television showed live pictures of a blazing inferno lighting up the night sky from the south side of the metropolis.
Camp Falcon is a major base in the southern suburbs of Baghdad, housing more than 2,000 coalition troops and civilian contractors deployed as part of efforts to pacify Iraq three-and-a-half years after the fall of Saddam Hussein.
Hours after the fire broke out, a regular drumbeat of explosions could still be heard five kilometers (2.4 miles) away in the city center, a barrage more intense than Baghdad's daily diet of car bombs and mortar strikes.
By morning, however, the blasts had become duller and more infrequent.
"All coalition forces and workers at the base were safely evacuated. At this time, no injuries have been reported," a coalition news release said. "The damage to the area will not degrade the operational capability of MND-B [Multinational Division Baghdad]," it said.
US troops in Baghdad are taking part in Operation Together Forward, along with more than 40,000 Iraqi personnel, to quell an eight-month-old outbreak of sectarian bloodletting between rival Sunni and Shiite factions.
Despite the security plan, United Nations and Iraqi officials estimate that more than 100 people are killed each day, more than at any time since the invasion, and Baghdad's streets are littered with corpses daily.
© 2006 Agence France-Presse
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