The bar, located at 1535 S. Novato Blvd., was closed at the time and was unoccupied, spokeswoman Sandy Wargo said.
A woman driving by smelled smoke and called 911 around 12:50 a.m., Wargo said.
Police arrived within a minute and saw smoke rising from the building. By the time firefighters arrived, thick, black smoke was coming from the front doors and roof, Wargo said. A second alarm was called at 1:03 a.m.
The fire was confined to the bar and grill, and did not damage an adjoining business, Wargo said.
Investigators believe it started behind the bar area and that it may have involved electrical components that were stored on a shelf, although the official cause has not yet been determined, Wargo said.
Damage has been estimated at $250,000, Wargo said.
Seven engines, two ladder trucks, two paramedic units and several chief officers responded to the blaze, Wargo said.
Firefighters from Larkspur, Kentfield and Marin County Fire Department also responded, Wargo said.