The flames at 7th Avenue and 52nd Street caused evacuations of hundreds of people.
An underground explosion sent flames shooting up from manholes in Times Square on Tuesday afternoon, but firefighters said there were no reports of injuries.
More than 130 firefighters raced to the scene around 4:30 p.m. to the three-alarm blaze, which raged under Broadway after undergound cables caught on fire.
Some witnesses said they saw chunks of concrete spew into the street when the fire first erupted.
Fire officials said one Con Edision worker was treated for minor injuries, but the utility was not experiencing any outages.
"We are working to stabilize everything and then we will begin to determine what happened," said spokesman Chris Olert.
The fire department said four buildings, including the Hotel Novel, were evacuated because of high carbon monoxide levels. It wasn't clear when residents would be able to return.
Broadway from about 50th to 54th streets was closed as firefighters worked to contain the blaze. Blue and red flames shot up from manholes and parts of the street were cracked.
CBS' "Late Show" with David Letterman was taping at the time at the Ed Sullivan Theater on Broadway, but was unaffected.