Country Fire Authority personnel were called to a blaze at the Peppermill Inn, Kialla, on Sunday night following reports of a fire in a laundry.
Four CFA units from Shepparton attended the business on the Goulburn Valley Highway about 8.40 pm.
A CFA spokesperson confirmed the fire broke out in a two-storey motel unit, within a small room estimated to be about 6 m by 3 m.
About 30 people were evacuated from the building, and the fire was brought under control within 10 minutes.
CFA personnel remained at the scene until just after 9 pm.
The CFA spokesperson said it was unknown at this stage what caused the blaze.
No-one was injured during the incident.