Alberta has declared a state of emergency as crews battle to hold back wildfires that have destroyed 1,600 homes and other buildings in Canada's main oil sands city of Fort McMurray, forcing more than 80,000 people to flee.

The wind-whipped flames were being kept from the city's central area thanks to the "Herculean'" efforts of firefighters, said Scott Long of Alberta Emergency Management Agency. No injuries or fire related fatalities have been reported.

The fire appeared near the airport late on Wednesday where crews were on site. All commercial flights in and out of Fort McMurray have been suspended.

Unseasonably hot temperatures combined with dry conditions have transformed the boreal forest in much of Alberta into a tinder box. Fort McMurray is surrounded by wilderness in the heart of Canada's oil sands - the third largest reserves of oil in the world behind Saudi Arabia and Venezuela.

Danielle Larivee, Alberta's minister of municipal affairs, said the fire was burning in residential areas with more than 250 firefighters battling the blaze. The Municipality of Wood Buffalo later said the fire was continuing to raze homes and had destroyed a new school.

There were haunting images of scorched trucks, charred homes and telephone poles, burned out from the bottom up, hanging in the wires like little wooden crosses.

Alberta premier Rachel Notley flew to the area to survey the situation, while officials in the evacuation centre had to flee to the south of the city as flames edged closer.

Ms Notley tweeted pictures of the fire from above, saying: "The view from the air is heartbreaking."

The blaze effectively cut Fort McMurray in two, forcing about 10,000 people north to the safety of oil sands work camps.

The other 70,000 or so were sent streaming south in a bumper-to-bumper line of cars and trucks that stretched beyond the horizon down Highway 63. Some vehicles sat in ditches, the victims of engine trouble or a lack of petrol.

Firefighters were working to protect critical infrastructure, including the only bridge across the Athabasca River and Highway 63 - the only major route to and from the city.

Public safety minister Ralph Goodale said it was one of the largest fire evacuations in national history, if not the largest.

"It's a community of 88,000 people that's been totally evacuated," he said. "This is going to take a while to recover."

Prime minister Justin Trudeau called it "absolutely devastating" with a loss on a scale hard to imagine. He said he had offered the province his government's full support and encouraged Canadians to support friends and donate to the Red Cross.

Mr Trudeau noted climate change was contributing to an increase in extreme weather and fires, but said it was difficult to establish a direct link.

Most oil sands projects are well north of the community, while the worst of the flames were on the city's south side. Mr Allen said he was not aware of any threat to oil facilities but called the fire a "moving animal".

Ms Notley said about 10,000 evacuees moved north where oil sands work camps were being pressed into service to house evacuees. The bulk of the evacuees fled south to Edmonton and elsewhere, and officials said they eventually would like to move everyone south.

Shell said it has shut down production at its Shell Albian Sands mining operations - about 60 miles north of the city - so it could focus on getting families out of the region. Suncor, the largest oil sands operator, said it was reducing production at its regional facility - about 15 miles north of the city. Many other companies evacuated non-essential staff.

Chelsie Klassen, a spokeswoman for The Canadian Association of Petroleum Producers, said all large oil sands facilities have emergency crews and plans for forest fires, noting all staff would be evacuated and plants would be shut properly to minimise the damage.

She said 80% of the oil sands was located deep underground and can be extracted only through a drilling process. The remaining 20% can be mined from the surface and predominantly located north of Fort McMurray. She said it could burn under certain circumstances, but oil sands would burn at a much slower pace considering its composition with sand.

City resident Breanna Schmidt said evacuating almost felt like "an apocalypse".

"We had to literally drive through smoke and fire, vehicles littered all over the sides of the road, and we had to drive as fast as we could and breathe as little as we could because the smoke was so intense and we could feel the heat from inside the vehicle," she said.

Former National Hockey League player Doug Sulliman said he could see from his apartment balcony that both sides of the highway south were engulfed in flames and estimated hundreds of homes in the Beacon Hill suburb over the hill were destroyed.

"You could hear the pop, pop, pop because of the propane tanks. The fire was just consuming these houses. It just destroyed the whole community," he said.

He said the highway later opened and it was bumper to bumper and said there were many cars on the side of the road because service stations were out of fuel.

"There was a Shell gas station that blew up and a Denny's next door. There was nothing but the foundation and it was still smoldering in flames," he said.