A fire broke out on three boats in Jedaf on Dubai Creek this morning at about 9am.
One of the vessels is believed to be a cargo launch.
Two explosions were heard by passers-by and thick plumes of smoke could be seen from the Business Bay Crossing nearby.
Civil Defence said fire crews were trying to extinguish the flames.
"Our people have started working on the fire. We are awaiting more information," said a spokesman.
Dubai Municipality officials said Civil Defence was handling the fire.
"Our environment department will be informed if it becomes a big problem," said Salem Mesmar, the municipality's assistant director general for environment, health and safety.
Dubai residents took to Twitter to post pictures of the fire and report on explosions.