The three-story brick building on the 400 block of 3rd Street South in Minneapolis, caught on fire around 3 a.m. this morning.
Minneapolis Fire Department have updated the fire to be a four-alarm fire, meaning four units were reported on scene.
The fire chief said the fire started on the second floor and spread to the third floor. Crews knocked down the first two floors and then it spread to the attic, which eventually vented through the roof.
Officials say there were around 250 occupants of the Drake Hotel that were all evacuated around 4:30 a.m.
Minneapolis Fire Department says two people were transported to Hennepin County Medical Center, but are expected to be okay.
EMS treated seven people on the scene for minor smoke inhalation.
Minneapolis Fire are tweeting live updates here.
Officials say they do not know what caused the fire yet, check back with more information.