Locals tried to use fire extinguishers to douse the flames when they broke out at 1 a.m., and customers were forced to flee eateries along the popular Bui Vien Street.
It eventually took firefighters with five fire trucks half an hour to extinguish the blaze, but they were unable to save the warehouse.
No one was inside when the fire broke out.
The backpacker area also includes Pham Ngu Lao, De Tham, Do Quang Dau streets, and the neighboring Pham Ngu Lao Ward in District 1.
The area is home to many bars, hotels, hostels, restaurants and travel agents.