Residents of a Sydney apartment block were woken by thick, black smoke before dawn today and spent four hours scared and shivering on the street after police said a car in their garage was deliberately set alight.

Neighbours described hearing convoys of fire engines, police cars and ambulances arrive at the three-storey block on Newman Street, Merrylands, about 4am.

More than 50 residents were evacuated and watched as firefighters extinguished the blaze.

Karim Dad said he was woken by police knocking at the door and he ran on to the street with his wife and four-year-old son.

"We were asleep, a very deep sleep.

"Someone was shouting from outside, 'There's a fire, fire!'

"Me and my wife and my son, we went outside to the other side of the road and we were waiting for a couple of hours."

A resident on the top floor called emergency services after waking up to smoke billowing from the unit block, Mr Dad said.

"By the time we woke up, there was only smoke.

"Black smoke was billowing from every side, from the four sides of the building.

"It was very nasty smoke.

"Very messy, very black and dark."

Mr Dad said neighbours were talking about the possibility that something was set alight and thrown into the garage.

He said residents, particularly children, were very upset as they waited to get back into their homes.

"It was very scary at that time.

"It was cold as well. We couldn't take a blanket with us."

After residents were allowed back into their units about 8am, many spent the morning cleaning up soot and sleeping off their early morning shock.

"When we came inside the unit, the doors, the windows were very dark, very smoky ... my son was very scared.

"He's fallen asleep now, so we're trying to clean up a little bit."

Five police officers were treated for smoke inhalation and taken to Westmead Hospital and have since been discharged.

A child was also treated after inhaling smoke and taken to Westmead Children's Hospital.

Fire and Rescue NSW Superintendent Ian Krimmer said fire investigators were still at the unit block and would pass on their findings to police.

Police are appealing for anyone with information about the fire to phone Crime Stoppers on 1800 333 000.