One structure has been destroyed and a second damaged after a fire broke out at the Laurieton Gardens Caravan Resort on Ocean Drive.
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Fire and Rescue crews were called to the scene on Friday (August 19) morning.
Jeanine Glasson was visiting her sister, who lives nearby, when the fire started at around 11.30am.
"It looks like they have one of the fires under control," she said.
"I can't see them pumping out too much water now."
Ms Glasson said she saw two structures in the village well alight.
"My sister lives just nearby the two buildings that were on fire," she said.
"It looks like the first one is pretty much destroyed."
A spokesperson from Fire and Rescue NSW said all people have been accounted for.
"The fire started in one of the demountables and has spread to a second structure," the spokesperson said.
"One middle aged woman is suffering from smoke inhalation and an ambulance has been called."
The spokesperson also said one of the structures has been "knocked down".
"The fire has now been brought under control by crews on the scene."