The Premier Illawarra coach was carrying a group of year 12 Kiama High School students to Sydney for an overnight excursion.

The driver pulled the bus over about 8kms north of Appin township, about 8.50am, after one of the 23 students on board raised the alarm.

“One passenger heard a loud pop a few kilometres back and smelt rubber burning,” Rosemeadow Fire Brigade station officer Chris Pont told the Mercury.

“There was a fire around the rear wheels - that’s where it’s believed to have started.

“It’s hard to determine [the cause]; there’s a few options. 

“We’re looking at whether a tyre blew. It could have even been that something got picked up between the tyres.”

The bus driver had evacuated the students and two teachers by the time firefighters arrived.

Firefighters, including RFS crews from Kentlyn and Appin, arrived to find the bus well alight. The rear two-thirds of the bus were completely gutted in the blaze.

No one was hurt in the fire.

The road was initially closed in both directions. 

Alternating stop/slow traffic conditions were later put in place as a clean-up operation progressed.