Firefighters had battled to extinguish the blaze as it ripped through the 85ft vessel in Torquay.
A superyacht carrying around 8,000 litres of fuel has sunk after it went up in flames while moored in a marina in Torquay, raising fears of an oil spill.
Firefighters battled to extinguish the blaze as it ripped through the 85ft vessel earlier on Saturday.
Devon and Somerset Fire and Rescue Service (DSFRS) said it had five appliances at the scene, and the case has been handed to the Environment Agency and the harbourmaster.
Emergency services had declared a major incident and officers evacuated a nearby beach and roads, with one witness describing the blaze as “like a fireball”.
Police said the cause of the fire is being treated as unexplained and inquiries are ongoing.
By around 6pm, the fire was out and crews were working on damping down the pier, a DSFRS spokesperson said.
Dramatic footage on social media shows black smoke and flames enveloping the anchored white yacht.
No injuries have been reported but the harbour was temporarily brought to a standstill, with fears over a large amount of diesel fuel on the boat.
A DSFRS spokesperson said earlier that the yacht contained “approximately 8,000 litres of diesel fuel”.
The Environment Agency South West said the focus had shifted to “pollution response” after the boat went under.
“Our officers have been checking air quality around Torquay harbour this afternoon following the yacht fire, which was declared a major incident,” it said in a post on Twitter.
“Thought to be no real issues with air quality, but we’re keeping an eye on the situation.
“With yacht now sunk, and with (approximately nine) tonnes of diesel on board, focus now on pollution. Pollution response led by harbour master. Our officers are helping with advice and guidance on bathing water quality etc.”
Grace Kedzior-Macdonough, 20, was visiting the seaside town with her partner when she heard “bangs or explosions” coming from the harbour.
She told the PA news agency she saw crew in neighbouring vessels spraying hoses to stop them catching alight as the fire was “spitting” flames out on to the water.
The ropes mooring the superyacht then burned off and it detached from the harbour and drifted towards a bridge which acted as a barricade, she said.
“We were just confused at first because we were just sat round the harbour and there was just this black smoke coming from nowhere.
“It was just getting worse because it broke off from the harbour because the ropes burned off and that’s when it travelled down the bridge.”
Torquay-based musician David Balmer, 58, said the sinking of the yacht had raised fresh concerns about the fuel on the boat leaking into the water.
“That could create another hazard in the harbour. They’re worried about the fuel getting into the water and into the harbour, which is obviously the last thing you want,” he told PA.
“There were masses of people around. It was engulfed in flames and there was this huge cloud of black smoke.
“It was quite a spectacle, it was just an unbelievable sight.”
He said onlookers had been told to leave the area because “there might be an explosion” and the crowds were moved a safe distance away.
A Devon and Cornwall Police spokesman said earlier: “Police were called at 12.10pm today to Princess Pier in Torquay following reports of a fire on a yacht moored in the marina.
“There have been no reported injuries at this time.”
Drew Parkinson, coastguard area commander for South Devon & South-East Cornwall Coastline, asked people to avoid the area as coastguards assisted emergency services in tackling the fire.