The submarine was anchored north of the Rybachiy peninsula near the Finnish border when it caught fire late on Wednesday.

The submarine is now being towed to the port of Vedyayevo, a base for Russian submarines in the Barents Sea.

A navy sourse said: "The fire was extinguished at midnight. It broke out in the electromechanical compartment. The device protecting the nuclear reactor was enacted. There is no radioactive contamination threat whatsoever."

Russian media said the submarine on which the fire broke out was called St Daniel of Moscow.

It was not immediately known if the vessel has been carrying armaments. It is a Viktor-3 class submarine which was built in 1988 and has a crew of 85.

Rusting submarines

Russia's Northern Fleet has been dogged by fatal accidents.

The worst in recent years was when the Kursk submarine sank in the Barents Sea six years ago, killing all 118 people on board.

Last year, the British navy helped to rescue the crew of a Russian navy mini-submarine that was stranded 600 feet down in the Pacific with dwindling air supplies.

Governments in Europe have been channelling aid to the Northern Fleet to help it safely dismantle decommissioned atomic submarines.

Many have been rusting for years in dock with their reactors still on board.