Every fire agency in the county responded to the blaze, said Dean Byrd, chief deputy with the Mason County Sheriff's Office. Firefighters also rushed to the scene from Thurston County and from the state Department of Natural Resources.
"We have 20 to 25 homes in the area that are in danger," Byrd said, adding that deputies are going from house to house in the Rainbow Lake area urging occupants to evacuate.
Jennifer Johns of Rainbow Lake was one of the residents advised to evacuate.
"I didn't even know what to grab, honestly, other than my brother and my dogs and some paperwork," she said.
Ten to 12 homes in the John's Creek area are under an "evacuation advisory," but there have been no mandatory evacuations.
Road closures also are in effect along East Rainbow Lake Drive, East Evergreen Drive and East Mason Lake Drive.
Crews are fighting the blaze from the ground and also by air, dropping water by helicopter.
"It's a very serious situation," Byrd said. "We still haven't got it contained."
The wildfire quickly grew from about five acres to 15 acres, then to 30 acres. By 8 p.m., Byrd said the fire had grown to 150 acres.
Many residents in the area said they couldn't believe that a fire this powerful would happen this late in the year.
"It's been freezing, so I was hoping that might help, but it's a little too dry," said Amanda Eagle of Limerick Lake.
The cause of the blaze was not immediately known.
The fire also poses a potential risk to a Bonneville Power Administration transmission line that runs through the area and provides electricity to the Shelton area.
"The one thing were concerned about is the potential for heavy dense smoke from the fire to cause the power to arc out of the line and take it off line and cause it to relay out of service," said the BPA's Doug Johnson.
"We're monitoring it, we have crews on site to defend the line as much as they can. But at this point there doesn't appear to be any immediate danger to the line," he added.
The wildfire comes as a "red flag warning" is in effect for much of Western Washington. The National Weather Service issued the warning Thursday morning, and said any fire that develops in the affected areas could spread rapidly due to the prolonged dry weather and a steady breeze.
"Any fire that develops may experience dry east to northeast wind. This could cause rapid rates of fire spread and control problems," the Weather Service warning said.
Late Thursday night the Red Cross announced it had opened a shelter for Mason County residents who left their homes because of the fire. The shelter is located at 2621 E. John's Prairie Road in Shelton.
This is a developing news story. More information will be posted as it becomes available.