The fire service said it was alerted to reports of a fire at Bailey Mill on Delph New Road in Oldham at about 15:10 BST.
Crews found several floors of the seven-storey building well alight and ultimately deployed four fire engines and an aerial appliance.
Greater Manchester Fire and Rescue Service has advised people to avoid the area and keep windows and doors closed.
There are currently road diversions in place on Delph New Road, Huddersfield Road and Diggle Road and residents on Station Approach have been evacuated.
Firefighters have tackled a blaze at a derelict mill in Greater Manchester.