TEHERAN (AFP) - Dozens of firefighters were feared trapped under the rubble after Iran's oldest high-rise, the 15-storey Plasco building in downtown Teheran, collapsed live on TV on Thursday following a fire.

State television said 200 firefighters had been called to the scene and "tens" may have been inside when the building collapsed.

Many had already been hurt before it came down, and initial figures said between 30 and 40 firefighters had been injured and seven hospitalised.

Dramatic images showed flames pouring out of the top floors of the building, which dated from the early 1960s and included a shopping centre and clothing workshops.

"The building's caretaker and some firefighters were inside when the building collapsed," said Ahmad, a shop owner in the building.

"I've lost my entire stock. Thousands of families have been ruined," he added.

The steel skeleton of the building could be seen bending down to the ground as around 100 fire engines and dozens of ambulances surrounded the area.

"A friend of mine has a shop there. I keep calling him but there's no answer. I think he's been trapped," said Mohsen, an onlooker.

Police evacuated the area around the building, fearing secondary explosions caused by gas leaks, and worked to clear crowds that were blocking access for rescue services.

"There a number of people inside but we don't know how many and the fire brigade organisation is going to announce how many were there," Teheran police chief Hossein Sajedinia told AFP.

"Even one would be too many," he added.

Fire brigade spokesman Jalal Malekias said the building was known to breach safety standards.

"We had repeatedly warned the building managers about the lack of safety of the building," he said, adding that it lacked sufficient fire extinguishers.

"Even in the stairwells, a lot of clothing is stored and this is against safety standards. The managers didn't pay attention to the warnings," he told state television.

The Plasco building was the first high-rise and shopping centre in Teheran and was the city's tallest building when it was finished in 1962, before being dwarfed by the construction boom of later years.

It was built by Habibollah Elghanian, a prominent Iranian-Jewish businessman who was arrested for ties to Israel and sentenced to death and executed after the 1979 Islamic revolution.

The fire is thought to have begun on the ninth floor and spread quickly to workshops above.

Firefighters were initially able to bring it under control but it quickly flared up and the building fell four hours after the fire had started, at around 11:30 am (4pm Singapore time).