There were no reports of any loss of life in the fire which broke out at the store at Boggalakunta. A woman, who was injured, was taken to a hospital.
Three fire engines doused the fire, which spread to an adjoining hotel. At least 10 two-wheelers were gutted in the mishap.
According to police, the incident occurred near the office of the endowment department. Loud explosions due to the burning firecrackers sent panic among people in the busy commercial area.
Dramatic visuals of customers rushing out in panic from the shop were aired on television channels. There was a stampede-like situation at the entrance with people struggling to save themselves.
Flying crackers with huge blasts turned the situation scary and soon the entire shop was engulfed in flames.
A transformer was also gutted in the fire, which spread to an adjoining hotel.
The fire broke out at Paras Fireworks store when customers were busy shopping. The cause of the fire was not immediately known.
Senior police and fire services officials rushed to the spot. Police said they were investigating the cause of the fire.
The incident ahead of Deepavali once again brought into focus the danger posed by firecracker shops in busy and densely populated areas.
The city witnessed similar incidents in the past. Six people were killed in a firecracker shop in Siddiamber Bazar area in 2002. The fire from the closed shop on the ground had engulfed the hotel upstairs, trapping the guests.
In 2007, four child workers were killed in an illegal firecracker manufacturing unit at Goshamahal.
A huge fire broke out in a firecracker shop in Mahabubganj market in the Malakpet area in 2010. No loss of life was reported but five fire tenders had to battle the blaze for several hours.