Iraqi and US officials said there did not seem to have been any casualties from the blasts, which lit up the night sky and unleashed a loud barrage of detonations audible several kilometres away.
"I believe it's still burning," he added, 11 hours after the fire broke out.” Lieutenant Colonel Jonathan Withington of the 4th Infantry Division said
Military and civilian personnel had been evacuated from Forward Operating Base Falcon without injury, he added.
Abu Sajad, who lives near Camp Falcon, said that "at the beginning we heard an ordinary explosion. We thought the Americans had fired at something, but I went out of the house and saw fire from inside the base.
"The explosions got stronger and stronger. Two window panes were broken in my house. Rockets were flying here and there, some of them far away. The fire went down then renewed again. Then there was a big explosion.
"We could not sleep all night. We went into two rooms in the middle of the house for safety. My brother put cotton wool in four of the children's ears. We hugged them to confort them.
The blaze broke out at around 10:40 pm (1940 GMT) on Tuesday and shortly afterwards the already shell-shocked city was stunned by one of the most powerful strings of explosions since the US-led invasion of March 2003.
Government spokesmen appeared on state television to urge calm and quash rumours that the city was under attack.
Iraqi officials said shells "cooking off" in the fire had crashed down in five areas in the south of the city, but the interior ministry said there did not seem to have been any casualties outside the base.
Camp Falcon is a major base in the southern suburbs of Baghdad, housing more than 2,000 coalition troops and civilian contractors deployed as part of efforts to pacify Iraq three-and-a-half years after the fall of Saddam Hussein.
"The damage to the area will not degrade the operational capability of MND-B (Multinational Division Baghdad)," a coalition statement said.