A Katherine family have lost their home after it was razed by fire Sunday afternoon, which appears to have been caused by kids playing with a cigarette lighter, NT Police said.

NT Police Northern Watch Command Senior Sgt Len Turner said firies responded to a house fire around 2pm on Sunday in Maluka Street.

Police said a woman inside the house noticed smoke coming from inside a cupboard before notifying emergency crews.

“Upon arrival, it appeared that the house was well lit up, but the occupants at that time had evacuated,” Sgt Turner told ABC Radio. “Police made some attempts to douse the fire but were unsuccessful.”

NT fire services arrived at the scene shortly after and managed to extinguish the flames, he said.

Police believe on initial investigation that the fire was started by a five- and seven-year-old who were playing with a cigarette lighter.

“The house is not livable now because of the smoke damage so the family’s trying to organize some emergency accommodation,” Sgt Turner said.

Investigators estimate the cost of the damage to the house to be approximately $400,000.

No one was reported injured during the incident.

Authorities have reminded parents to keep materials that may ignite fire from children’s reach and to ensure smoke detectors are working.