There is much contradiction as to where the fire originated, but it is pretty generally conceded that it was in the upper story of the frame building on the corner of Merchant and Kearny streets, occupied by some lodgers.

In a very short time all the buildings on the corner of the street were in a blaze, and wholly beyond the power of human aid to save. The close proximity of the building to the Union, on the opposite corner, rendered the probability of its destruction almost certain. In a very few minutes the latter building caught. In the meantime the frame buildings on Merchant, and between that and Clay streets caught, and were in a blaze.

The whole force of the fire department were promptly on the spot, with their apparatus, and put into the most effective service. Never since they have been in organization have they displayed their unequalled energy and training as they did on this occasion.

Fortunately for the safety of the lower part of the city, there was but little air stirring, and a slight misty rain had fallen during the day and evening, which checked the tendency of the fire to spread towards the bay. Had it not been for this, the mass of sparks falling upon the roofs of the frame buildings on the east side of Montgomery street, must have extended it to the whole lower side of the city. These buildings were covered with men provided with wet blankets, buckets of water, and every thing necessary to extinguish the flames, should they communicate to their roofs.

The fire burnt eastward to the buildings of Messrs. Austin & Lobdell, fronting on Clay street, and that of Mr. Naglee, fronting on Merchant street. On the north side of Merchant it took the Union Hotel, and all the buildings fronting on that street, down towards Montgomery, to Bolton and Barron's building. It did not cross over to Washington in any instance. This is the second time that the building of Messrs. Austin & Lobdell has proved an effectual barrier to the progress of a fire, and without receiving the least injury itself, or damaging the goods within it.

Nothing but the determined and unparalleled efforts of the firemen prevented the fire from extending to the south side of Clay street; as it was, some $10,000 damage was done to goods and buildings upon that side.

The fire broke out, as we have said, at half past eight o'clock, and it was not until a quarter past ten that it was checked or its further spread prevented, and the engines worked for some time longer.

The records of the different courts in the old City Hall were removed, but thrown into the utmost confusion.

In the midst of the excitement, Mr. Masalski, a gentleman well known to the community as the former keeper of the Sacramento House, rushed to the scene of disaster, and shortly afterwards returned to his dwelling. He was immediately seized with the most alarming symptoms, and in a few moments breathed his last. Dr. Guatier, who attended him in his last moments, says that it is difficult to pronounce upon the cause of his death, other than that it was brought about by congestion of the brain, but what was the immediate cause of this congestion he is unable to say at present.

It is of course impossible for us to give a correct estimate of the losses sustained, but we have heard it variously estimated as from $150,000 to $200,000.