Sharon DeWitt, emergency measures co-ordinator for the nearby community of Plaster Rock, said it's unclear how big the fire is or whether anyone was hurt.
"To the best of our knowledge, only a few cars are involved and we are not exactly sure what those cars are carrying," she said in an interview. "We have evacuated homes in the immediate area."
A spokeswoman for Ambulance New Brunswick said no casualties were transported from the site.
CN (TSX:CNR) spokesman Jim Feeny confirmed the eastbound train was carrying dangerous goods, including crude oil and propane.
"Some of those cars are in the area of the derailment," he said. "Whether they have derailed or are on fire, I do not have confirmation of that."
He said the regularly scheduled freight train was headed to Moncton from Central Canada when it ran into trouble around 7 p.m. about 150 kilometres northwest of Fredericton.
"We are deploying full emergency response ... from Moncton, Toronto and Montreal," Feeny said. "Their priority is to protect the safety of the people and the environment."
The train's engineer and conductor, the only people on the train, were not hurt in the derailment, he said.
DeWitt said the train left the tracks about five kilometres from the village in a wooded area.
"There's a lot of fire personnel on site or en route," she said. "Police and ambulances are also on site."
DeWitt said there is one road near the site, which includes a number of homes.
There were unconfirmed reports of an explosion, but DeWitt said she was not aware on any blast at the site.
"We have been told there's no immediate danger," she said.
She said the village has opened an evacuation centre for displaced residents. However, those told to leave their homes are all staying with family and friends.
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