More than 80 FRV firefighters have been called from surrounding suburbs after an automatic fire alarm activated just before 7.30am on Saturday.
FRV said five workers had safely evacuated the factory that produces plastic shipping pellets.
It said crews immediately escalated the response, sending additional appliances and personnel.
It has been closed westbound at Cairnlea Drive due to the significant amount of black smoke in the area.
It comes a little over a week after a massive chemical explosion and fire in Derrimut, also in Melbourne's west, that prompted the biggest firefighter response in several years.
Emergency Management Victoria has issued an advice message for Deer Park and the surrounding suburbs of Ardeer, Cairnlea, Derrimut and Sunshine West saying there was no threat to the community but that residents and workers should monitor the situation.
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