The incident happened last night at a cocktail bar called Dr Inks in Stockton-on-Tees, Cleveland.
An arcade containing several pubs was evacuated and cordoned off.
Police and fire crews have not yet identified the mystery substance.
Man describes being sprayed in face with chemical during Wakefield bike shop robberyDrinkers described how the 'slow-moving' gas began to drift through the air, leaving people struggling to breathe. Eventually around 40 people were affected by coughing fits before crowds began to leave the bar.
Police carry out chemical tests at Leeds housePolice are analysing CCTV to establish where the gas came from and if anyone was responsible for releasing it.
Nobody was hospitalised although ambulance crews were sent to the scene.