Five fire appliances from North Yorkshire Fire and Rescue raced to the seafront on Foreshore Road at 10.30am yesterday (Saturday October 14) .
The fire is believed to have spread from the cooking fryers in the property to the roof of the three-storey building.
A spokesperson for North Yorkshire Fire and Rescue said no one was injured.
Staff at Harry Ramsdens as well as houses and businesses nearby were evacuated.
Cllr Janet Jefferson, of Castle Ward, said: " It was a very frightening experience for us living behind within our 6 plus storey properties in fact we were all in a state of shock and had to evacuate.
"The fire brigade did an excellent job and proved how essential the turntable vehicle and cradle is within our tiered landscape of buildings when having to target their jets from above.
"Our sincere thanks to all the firefighters."
Firefighters used breathing apparatus, hose reels, ladders, an aerial ladder platform, thermal image cameras, water jets and small tools to extinguish fire.
With fire extinguished, crews sealed premises and returned for further inspection later in the day.