According to media reports, a freighter with around 4,000 German cars from the Volkswagen group caught fire on the Atlantic south of the Azores.
The 22 crew members gave up the almost 200-meter-long "Felicity Ace" and were taken to safety, the Portuguese newspaper "Público" reported, citing the authorities.
The fire on the car transporter flying the Panamanian flag, which was on its way from Emden to Davisville in the US state of Rhode Island, broke out on one of the car decks on Wednesday.
Videos on the Internet showed white smoke pouring out of the huge ship.
There is currently no risk of the fire reaching the ship's fuel tanks, officials said.
The Portuguese Navy's patrol boat "Setúbal" is with the ship, which is adrift in the sea about 170 kilometers southwest of the Azores island of Faial.
Experts from a Dutch salvage company are expected on Friday to examine the possibility of towing the ship to a port.