The Cass County Sheriff's Office said the National Weather Service was forecasting a shift in the weather.
"That's going to put the plume right over the top of Casselton," Cass County Sheriff Paul Laney said. The town has about 2,400 residents.
No one was hurt in yesterady's derailment, and the cause was being investigated.
The derailment in North Dakota, the country's No 2 oil-producing state, happened amid heightened concerns about the United States' increased reliance on rail to carry crude oil.
The number of crude oil carloads hauled by US railroads surged from 10,840 in 2009 to a projected 400,000 this year.
Despite the increase, the rate of accidents has stayed relatively steady. Railroads say 99.997 per cent of hazardous materials shipments reach destinations safely.
North Dakota's state's top oil regulator has said he expected as much as 90 per cent of the state's oil would be carried by train in 2014, up from the current 60 per cent.
The National Transportation Safety Board said it has launched a team to investigate the accident.
The railroad tracks pass through the middle of Casselton, and Cass County Sheriff's Sgt. Tara Morris said it was "a blessing it didn't happen within the city."
Morris said it could take up to 12 hours before authorities could get close to the fire.
Hannah Linnard, 13, said she was at her friend's house about half a mile (800 metres) from the derailment.
"I looked out the window and all of a sudden the train car tipped over and the whole thing was engulfed in flames and it just exploded. The oil car tipped over onto the grain car," she said.
She could feel the warmth even inside the house.
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