Three fire appliances, police and the ambulance service rushed to the incident at The Crescent shortly before 1pm.
Lancashire Fire and Rescue Service said it had received a report of persons in the building.
Firefighters used breathing apparatus, one hose reel, a ventilation unit and the door ram to tackle the blaze.
Fire Incident commander, watch manager Ally Park, said: "The building was smoke logged when we turned up.
"The cause is due to a couple of individuals squatting in the basement at the rear.
"It seems at this present moment someone has gained access to the building and set fire to wood.
"It has smoke logged the whole building."
Mr Park said following a search of the building he was confident no-one was in there.
The fire service said all persons had been accounted for.
One resident of the flats, Jessica Pryce, aged 19, rushed home from nearby Fresh Cafe, where she was working as assistant manageress, after receiving a phone call from a friend.
Jessica, a journalism student at John Moores University, Liverpool, said: "I live in the first floor flat. I was at work and got a phone call from my friend saying there are fire engines outside your flat and they are going into the flat. I ran down.
"They told me we might have some smoke damage. I nearly had a heart attack.
"I'm just waiting to get into the flat to see if there's any damage."
Chris Geraghty, a 21-year-old electrician, who lives in the first floor flat, said: "I was at work and Jess phoned me to say that there were loads of fire engines outside the flat.
"I nearly had a heart attack, but I've just about recovered now."