The fire brigade was called just before 6pm on Tuesday, November 7, to the building which is undergoing major renovation work.
Huge flames could be seen coming from the top of the building in Wesley Square and multiple fire crews are currently on the scene this evening.
There is no indication at this stage how the fire started.
Cleveland Fire Brigade told the Mail: “We got the call at 17.54 and are still dealing with it at the moment.
"We have got five appliances and the aerial ladder in attendance.
"We are going to be delayed there for quite some time as the building is well alight.”
Road closures were in place and the brigade asked people to avoid the area.
The incident did not end until 3.20am on Wednesday. Fire engines from Hartlepool, Billingham, Stockton and Saltburn attended.
The extent of the damage to the building is not yet knon.
It is the second major fire to hit the building in recent years after the last in December 2017 left it gutted and the roof destroyed.
The blaze was investigated by police as a suspected arson attack.
After more than a decade standing empty, work started in March this year to convert the former Methodist church and later nightclub into a hotel in a £3.8m scheme delivered by Hartlepool Borough Council and property developer Jomast.
The council’s investment in the scheme is being funded through the Hartlepool Town Deal in one of a number of planned regeneration projects.
Last month, Jomast submitted fresh planning applications for minor adjustments to the development.