Ten tenders of the fire brigade battled the blaze for an hour and brought it under control, police and fire brigade sources said.
Firemen evacuated people from the area as a precautionary measure, the sources said.
Local people helped firemen fetch water from ponds with hose pipes laid over railway tracks leading to suspension of Budge Budge-Naihati and Canning-Bongaon train services.
Fire Services minister Javed Khan said that there was no casualty in the fire which gutted over 100 shanties.
The situation was under control, he added.
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