"The building is being evacuated," said Gordon Absher, spokesman for the hotel owner, MGM Mirage Inc.
There were no immediate reports of injuries, according to an ambulance dispatcher.
Huge crowds formed to watch the fire, and traffic on the Las Vegas Strip was gridlocked as streets were blocked off around the hotel.
The Monte Carlo Resort & Casino has more than 3,000 guest rooms and opened in June 1996.
The 32-story casino-hotel modeled after the Place du Casino in Monte Carlo, Monaco, was a joint venture between Steve Wynn's Mirage Resorts and Circus Circus Enterprises.