Several fire engines and at least one ambulance are on the site with onlookers saying an "upstairs room" was on fire earlier.
Pictures and video shared on social media show flames upstairs on the eastern side of the building.
The first floor isn't open to the public.
There are now no flames visible and water from hosepipes is pouring down the drive which leads to the pub.
Bystanders say five appliances were on the site. This has now reduced to three.
North Yorkshire Fire & Rescue posted this on their night shift log:
Scarborough and Filey crews attended and extinguished a fire to a residential building. Hose reels used. A fire investigation officer also attended.
We'll have more as we get it.
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