Fire crews were called to the site, off Station Road in Ranskill, shortly after 10.20am on Friday where thousands of tyres as well as scrap vehicles were involved in the fire.
Damage was also caused to outbuildings and power lines.
Police assisted with the evacuation of nearby business premises, with an area cordoned off and local road closures in place, as the fire crews continue to tackle the incident.
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It was reported two people were treated by paramedics after sustaining minor smoke inhalation injuries.
People are being urged to avoid the area if possible and those living in or travelling through the area are advised to keep windows and doors shut.
Inspector Matt Scott, of Nottinghamshire Police, said: “We are continuing to work closely with Nottinghamshire Fire and Rescue Service and a joint investigation will be launched to establish the circumstances of how the fire began.
“While the cause is still unknown we are currently treating it as suspected arson after it was reported a group of young people were seen letting off fireworks just before the fire started.
“We are urging anyone who may have witnessed anything or has any information which could assist us with our enquiries to please come forward.”
Area manager Andy Macey, of Nottinghamshire Fire and Rescue Service, said: "We are still at the scene tackling the fire and expect we will be here for a number of days.
"We will be working closely with our police colleagues on a joint investigation looking into the cause and ask anyone with information to come forward.
"Thank you to our partners in Derbyshire, Lincolnshire and South Yorkshire fire and rescue services for their support.
"We ask the public not to gather near the scene as they put themselves at risk and hinder us in our work.
"We are likely to be on scene for some time so we thank the public for their patience."
Anyone with information about the incident is asked to call Nottinghamshire Police on 101, quoting incident number 240 of 5 August, or Crimestoppers anonymously on 0800 555 111.