The vehicle caught on fire at Westside Plaza on Murrayburn Road, Edinburgh, just before noon on Tuesday, May 18.
Pictures appeared to show that another vehicle was damaged in the incident.
No injuries have been reported but a nearby library was closed “as a precaution”.
Residents were asked to keep their windows and doors closed while smoke billowed from the burning lorry.
Speaking to the Evening News, a source on the scene said there were two vehicles involved in the incident, with both destroyed by the blaze.
They said that what appeared to be a flaming fuel container was launched across the road from the second vehicle.
They added: “Massive credit needs to go to the firefighters involved, they were rapidly on the scene within six minutes of the first explosion.”
An eyewitness said they had heard at least 10 explosions in a matter of minutes.
Alex Forsyth, whose home overlooks the scene, said: “I looked out the window and saw what looked like a petrol tanker and explosions going off.
“I was hearing these explosions for three minutes. There were over 10 explosions.
“We had to get out of the house because we felt the vibrations on the windows. I was sitting playing a war game and thought the first bang was a dumper truck on the construction site across the road.
“Then I went to the window and couldn’t believe what I was seeing.”
Another eyewitness who drove by the scene just after 12pm described seeing flames reaching two meters high before the police moved him on.
A Police Scotland spokesperson said: “We were called around 12.05pm to a report of a works vehicle on fire in Murrayburn Road, Edinburgh. Officers are currently in attendance along with the Scottish Fire and Rescue Service and the Scottish Ambulance Service.
“There are no reports of injuries but a nearby library has been closed as a precaution and residents have been asked to keep their windows closed due to smoke.
“Murrayburn Road is closed in both directions and Hailesland Road Murrayburn Place are also closed.
“Drivers are asked to avoid the area.”