A Kyneton man has been arrested after three people were injured in a suspicious fire in the Newmarket Hotel at Kyneton.
Fire broke out in the upper floor accommodation section of the hotel shortly before 7pm last Tuesday night.
A triple zero call taker, hearing people coughing, immediately responded multiple CFA units and paramedics.
Six guests were evacuated as firefighters in breathing apparatus extinguished a fire in a bedroom. Three people were taken to hospital suffering from smoke inhalation, one with significant respiratory failure. All three are now recovering.
Investigations into the incident, which is being treated as arson, are continuing. The man has been released and is yet to be charged.
Anyone with information is asked to contact the Macedon Ranges Crime Investigation Unit on 5421 2900 or Crime Stoppers on 1800 333 000.