Emergency services were called to the double-storey unit at Pur Pur Avenue just before 10:30pm to find a bedroom on the second level of the home well alight.

All occupants were evacuated.

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NSW Ambulance paramedics attended the incident and treated four people for smoke inhalation, two of those had to be taken to hospital for further treatment.

Fire and Rescue NSW crews from Warrawong and Shellharbour were in attendance and battled the blaze for over an hour, eventually extinguishing the fire by about 11:26pm.

The Mercury understands a gas camp burner or "non-conventional heating device" was the cause of the blaze. It's believed to have been used to keep the residents warm before exploding.

Fire & Rescue NSW Duty Commander Illawarra Andrew Erlik said it's a concerning problem that people are using "alternative methods" for heating which could be life-threatening.

"It's a timely reminder you need to use appropriate heating devices so they're not faulty," he said.

Inspector Erlik advised to never use outdoor heaters indoors, nor should you use barbecues or charcoal pits inside the home for heating - as LPG, heat beads and the like emit lethal carbon monoxide which an be fatal.

A NSW Police spokesman said at this stage it was not being treated as suspicious.

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It comes as a family of five - including an 18-month-old baby girl - were hospitalised in Sydney's southwest on Monday after trying to use barbecue heat beads to warm their home.

The Cabramatta family fell ill and were rushed to hospital for carbon monoxide poisoning.