Up to 140 people who had to be evacuated have also been allowed to return to their homes, police said.
The blaze started in Abbey Mills, off Ross Walk, in the Belgrave area of the city on Monday afternoon.
Leicestershire Fire and Rescue said the fire was "now contained", although crews remain at the scene. Some homes were affected by a power cut.
A series of roads around Ross Walk will remain closed overnight, police said.
"Some homes in Westbourne Street and Kensington Street were evacuated and residents have now been allowed to return to their properties," Leicestershire Police said in a statement.
"As a result of the fire, homes in Marjorie Street and Kensington Street have been affected by a power cut.
"Engineers from Western Power are at the scene working to restore electricity as soon as possible."
Those affected have been told to go to Belgrave Neighbourhood Centre, in Rothley Street, which was earlier set up as a refuge.
At the height of the blaze, water was taken from a nearby canal to help tackle the flames and dozens of onlookers were moved on by police because of the "toxic" smoke being given off.
Roads that remain closed are Abbey Park Street, Olphin Street, Moorgate Street, Westbourne Street, Kensington Street and Marjorie Street.
There were no reports of any injuries, police said.
Smoke could be seen from Bradgate Park, about five miles [8 km] away.
A "massive" fire that broke out close to factories in Leicester has been brought under control.