Firefighters responded to the blaze about 1:30 a.m. at the apartment building in the 700 block of South Keeler, according to Chicago Fire Department Deputy District Chief Curtis Hudson.
An 86-year-old man was found dead in an apartment and pronounced at the scene, according to Chicago police. The Cook County Medical Examiner's Office did not immediately provide information on the fatality.
The police Bomb and Arson Unit was investigating the cause of the fire early Tuesday.
Smoke and fire billowed out of a third-floor apartment window where a family had been having a Christmas party earlier in the night.
"It's just crazy now that man's gone. He was just laughing, dancing with us all last night and now this this is crazy," said Tawana Sanders.
The apartment belongs to her father, George Sanders, 62, a longtime resident of the building near 5th Avenue and Keeler. He suffered from smoke inhalation and was rushed to Mount Sinai Hospital in critical condition.
"They say he came out the back way I guess, and I guess the fire people got here in time to help him out," Tawana Sanders said.
Tawana Sanders says her dad hosted the family Monday night for Christmas, inviting his 86-year-old friend to stay over and celebrate.
"I heard somebody saying get out of the building and we got out of the building," said basement resident Ernest Buie. "This is depressing right now because I got a lot to do."
The building has five apartments and 12 residents. Walker Harris, who has owned the property since 1986, says the heat was working.
"Everything was up to code, had no problems with the building, period," Harris said. "Very heartbreaking, very special time of the year."
The Chicago Fire Department's Public Education Division was out at the scene Tuesday passing out safety materials to the neighborhood.