Vallejo firefighters were dispatched to the fire at 5:27 a.m. today to the detached garage of the home at 518 Lincoln Blvd. East, just east of Interstate Highway 80, fire spokesman Mark Libby said.
Seven adults and two children had been residing in three different living spaces in the garage, Libby said.
Firefighters battled and put out the blaze, which went to two-alarms, Libby said.
The displaced people accepted assistance from the Red Cross for alternative housing, Libby said.
Medical personnel treated one person for smoke inhalation at the scene.
The garage, which was redesigned as a living space, was gutted and two cars parked next it were destroyed, Libby said.
The separate home next to the detached garage was not damaged. Power will be shut down to the home because it was the source of power for the detached garage, Libby said.
The cause of the fire is being investigated today and the fire department will be interviewing residents and other possible witnesses.
"They'll give a report on at least how and where it started," Libby said.