Two Kangaroo Valley Rural Fire Service crews are investigating reports of smoke in inaccessible bushland west of Kangaroo Valley.
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Crews are responding to reports of smoke in the area around Paddington Lane, off Moss Vale Road, a couple of kilometres west of the township.
It is believed there is a fire in inaccessible country, with crews saying it is burning towards Barrengarry Mountain.
Two crews have arrived at the scene and have sighted smoke.
A control post has been established at the location and with a crew going in on foot to investigate the source of the smoke.
The Heavens Mountain Escape, self contained accommodation set on 160 acres, is located at the end of the lane.