President Michelle Bachelet has declared the city a catastrophe zone, which puts the armed forces in charge of maintaining order and evacuating thousands of people affected by the smoke and flames.
Valparaiso Mayor Jorge Castro said ``at least 500 homes have been destroyed by the fire.'' He said shelters for those forced to flee have been set up.
Castro said earlier the city was without electricity and the flames were ``advancing in an apparently uncontrollable manner.''
Firefighters were having difficulty combating the blaze because of the topography of the city, which is surrounded by dozens of steep hills where most people live.
Valparaiso is about 120 kilometers (75 miles) northwest of the capital, Santiago.
-AP
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