Humberside Fire and Rescue were called out at around 6.30pm on Christmas Day to the biogas plant on Crosslands Lane in North Cave, East Yorkshire.
No casualties were reported as the plant was not believed to be operational at the time.
At its height, 62 firefighters and 12 engines were working at the scene to control the blaze.
They used a foam blanket and put a bund retaining wall around the building housing the burning vegetable oil.
The fire service said crews were expected to be on scene until lunchtime on Boxing Day.
Locals were asked to keep doors and windows closed as a precaution, although there was no indication the smoke was hazardous.