A total of 1,050 people were ordered from their homes in the hamlets of Mogan, San Bartolome de Tirajana and Tejeda on the island of Gran Canary while an undetermined number of people have sought shelter elsewhere on their own, a local government spokesman said.
The fire, which broke out in a mountainous and sparsely inhabited part of the island but has since spread, has nine active fronts that is burning in hard to reach areas, he added.
"The situation is difficult," the spokesman said.
More than 200 firefighters, army and civil protection workers backed by seven helicopters and a water bomber, or a plane dropping water, were battling the blaze which has so far destroyed more than 3,500 hectares (8,645 acres) of land.
The flames had already reached several homes in Mogan, an employee of the hamlet told AFP earlier.
Firefighters had brought the fire under control, but had not completely extinguished it, on Sunday before the winds picked up overnight and fuelled its spread.
A 37-year-old forest ranger who was one of the first to raise the alarm was arrested Saturday and said to have confessed to having started the fire because he wanted his work contract which expires in September to be extended.
Meanwhile, on mainland Spain around 200 people backed by two helicopters and three water bombers battled a blaze which broke out on a military firing range Friday near the southern town of Cordoba.
The fire was under control by Monday afternoon, the regional government said. The blaze has destroyed 4,100 hectares of land.
In neighbouring Portugal nearly 150 firefighters, backed by 35 vehicles, six helicopters and four water bombers, battled three fires in the centre and south of the country, emergency services officials said.
The largest fire raged along two fronts near the central town of Sabugal. Sixty-five firefighters backed by two water bombers and a helicopter were battling it.
"Various firefighting corporations are on their way to reinforce the teams already there," an emergency services chief told national news agency Lusa.
The fires come as temperatures soared above 40 degrees Celsius (104 Fahrenheit) in many localities in Spain and Portugal.