Firefighters discovered a body in a burned-out room on the third floor of the hotel. Officials have identified the victim as 45-year-old Minnette Edmon of Joliet.
Two people suffered minor injuries in the blaze. They are expected to be OK.
Firefighters from surrounding communities spent hours dousing the brick building as flames shot from the roof. After a three-hour battle, they brought the fire under control, leaving the rooftop smoldering and the structure gutted.
"It's been a while since we have had something like this, but we're ready. Everybody else was ready. We had a lot of help. We have a lot of friends in the neighboring communities that come down and give us a hand," said Rob Cronholm, Lockport Fire Chief.
Witnesses were surprised at the speed of the response.
"They did a good job. It was blazing really good. I'm surprised it didn't catch any other buildings on fire," said Jeff Yuhas, Lockport resident.
Firefighters kept the blaze from spreading to nearby buildings in Lockport's historic district.
"The wind was a real problem. The wind was out of the southeast, kind of pushing it north. The building to the north, they share a party wall so there was a lot of concern the fire would extend into the next building to the north," said Cronholm.
Most of the second and third floors of the building were destroyed. The bar and restaurant on the first floor was also badly damaged.
Authorities believe as many as 14 people were staying at the hotel when the fire started. Some of them were living there.
Ed Zamora, a musician from Lockport, had just moved in. His instruments and most of his belongings are gone, but he managed to escape the fire.
"About 4:00, I heard everybody yelling there was a fire. I did hear people like knocking on the walls and the doors and stuff and I got up, just threw on what I had, just ran out," said Zamora.Agents from the Federal Bureau of Alcohol, Tobacco and Firearms were helping local officials investigate the origin of this fire. They say so far, there's nothing to indicate anything sinister, but they haven't ruled anything out. "I could finally see through the smoke. I saw the building across the street. It was engulfed in flames up top," said Scott Tidwell, witness. It was an early morning wake-up call for firefighters and those who live near Lockport's historic downtown. This building has stood on the corner for more than a century. But on Tuesday morning, building residents say smoke alarms and neighbors' screams sounded the alarm. But Edmon apparently couldn't find her way out. "She panicked. She just took off running, like into the fire kind of," said Kimberly Logan, former hotel employee. "I got up and just threw on what I had and just ran out," Zamora said. Minutes later, Zamora saw a section of the roof collapse. He knew that he and the other dozen or so people who called the Towpath Inn home had just lost everything. "I lost my computer, several music instruments, my guitars, all my clothes, so pretty much everything that I had in there," Zamora said. Firefighters struggled against low water pressure, high winds and high windows on the riverside of the building. The ladders barely reached some residents. He hung from the window, and they got the ladder up high enough for him to get his toes on the ladder and one of our firefighters got up and helped him down on the ladder. And I don't know if you guys have ever tried that but it's not an easy stunt," said Cronholm. Investigators assisted by a cadaver dog spent much of the day ensuring that there were no other fatalities. George Carres was the live-in security guard the last seven years, and his niece was the office manager. "You go there, and it's just like, the lives are what's most important. And I still have him. Thank God," said Carres' niece. The Will County Coroner is still tracking down next of kin for that person who did not survive the fire. The identity has not yet been released.
The Metra commuter rail service canceled train service into Chicago along the Heritage Corridor line due to the fire, which is near Metra's Lockport station.
The Red Cross is assisting those who were left homeless by the fire.
The cause of the fire has not been determined.
Lockport is about 25 miles southwest of Chicago.
The Associated Press contributed to this report. All rights reserved.