North Yorkshire Fire Service said its crews were called to the Feversham Arms hotel in Church Street shortly after 1.10pm today when a chemical spill was reported.
A spokesman said: "On their arrival, crews found that the incident involves an accidental chemical spill which has produced a gas.
"Cordons have been put in place and an evacuation of the hotel and some neighbouring properties is currently under way."
The spillage is contained and there is no wider risk to the public, the spokesman added.
Firefighters wearing breathing apparatus are currently investigating the spill and ventilating the building as a precaution.
The activity is focused on items in the plant room of the hotel.
Crews are likely to remain at the scene for some time, the spokesman said.