Balls of flames shot several metres into the air after the derailment near the U.S. border.

Up to 1,000 people were evacuated in the community about 250 kilometres east of Montreal.

At a press conference on Saturday morning mayor Colette Roy-LaRoche was near tears as she addressed media.

"When you see the downtown of your city almost destroyed you think, how are we going to get through this? But I can assure everyone here that all the authorities and ministries have been very supportive," she said. "We've deployed all the resources possible."

Police and fire fighters have secured a perimeter around the area where buildings continue to burn.

It was not immediately known whether there were any casualties.

Quebec provincial police Lt. Michel Brunet said it was too early to say if anyone was dead.

“We’re told some people are missing but they may just be out of town or on vacation,” Brunet told a news conference.

“We’re checking all that, so I can’t tell you at the moment whether there are any victims or people who are injured.”

"It's dreadful," said Lac-Megantic resident Claude Bedard. "It's terrible. We've never seen anything like it. The Metro store, Dollarama, everything that was there is gone."

Some of the train's 73 cars exploded and a fire that that could be seen for several kilometres spread to a number of homes.

"The flames in the sky were really impressive," said resident Pierre Lebeau.

A large but undetermined amount of fuel also reportedly spilled into the Chaudiere River.

Several neighbouring municipalities, including Sherbrooke and Saint-Georges-de-Beauce, were enlisted to help Lac-Megantic deal with the disaster.

The train belongs to Montreal Maine & Atlantic, which says on its website that it owns more than 800 kilometres of track servong Maine, Vermont, Quebec and New Brunswick. The train was reportedly heading toward Maine.

The cause of the derailment was not immediately known.

Environment Quebec spokesman Christian Blanchette said the 73 cars were filled with crude oil and that four were damaged by fire and the explosions.

"Right now, there is big smoke in the air, so we have a mobile laboratory here to monitor the quality of the air," Blanchette said in an interview.

"We also have a spill on the lake and the river that is concerning us. We have advised the local municipalities downstream to be careful if they take their water from the Chaudiere River."

The Transportation Safety Board of Canada announced just before the press conference that investigators have been deployed to Lac-Megantic to carry out an assessment of the explosions. The TSB is an independent agency that investigates incidents related to marine, pipeline, railway and airway. transportation.