A live explosion exercise was under way when a fire that came within a kilometre of homes on the NSW south coast started on Thursday, the Australian Defence Force has confirmed.
The blaze threatened houses in the small town of Currarong after starting on the Beecroft Peninsula and tearing through an unexploded ordnance range.
Firefighters managed to control the fire after several hours by dousing it with retardant from the sky, but the blaze is still burning and an advice warning remains in place.
A Defence spokesman said in a statement that a fire started within the Beecroft Weapons Range at about 11am on Thursday, and was successfully contained within the weapons range.
"A live mortar fire exercise was in progress at the time, being conducted in compliance with all applicable fire safety procedures and tolerances," he said.
"The exercise was stopped when the fire started."
The Rural Fire Service (RFS) is investigating the cause of the blaze.
In 2013 a massive blaze known as the State Mine Fire, which destroyed 50,000 hectares of land and three homes around the Blue Mountains, was sparked by a Defence Force military exercise.
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