What was first reported as a 25-acre brush fire spread to at least 200 acres. Fire officials at one point stated the acreage was at 250 but later downgraded that number. Containment was at 0 percent, according to Laguna Beach fire and police officials.
There were no reports of injuries or structural damage.
Eight fire strike teams, six air tankers and four helicopters were used in the firefight, Laguna Beach police said.
Bulldozers cut a line near hilltop homes to stop the flames from racing up a ridge.
Fire department officials said the wind shifted multiple times throughout the firefight, which caused several spot fires and difficulty for fire crews.
Firefighters were able to gain the upper hand when winds began to diminish.
About 2,000 residents at one point were impacted by the fire and homes were threatened, officials said.
Many evacuated residents said they were well aware of the danger.
"We have the dog, we have the wedding rings, we have the heirlooms and the important documents. We have trust in the Laguna Beach Fire Department," said Laguna Beach resident Toni Engstrom.