Emergency services were alerted to blaze at the Grade II listed Easingon Primary School,
A spokesman for the County Durham and Darlington Fire and Rescue Service said two appliances from Peterlee Fire Station attended the scene and soon called for
The classroom was extensively damaged, while the rest of the building was smoke damaged.
Eye witness Jonny Hogg said: "I was walking past the school when I saw smoke coming out of a boarded up window and went home to call fire brigade - but then heard sirens coming.
"The firemen broke open a ground floor door and entered. There were flames pouring out of a first floor window.
"If they had not arrived quicker the whole place would have gone up."
Fire brigade spokesman said "There was no obvious accidental cause to the fire. We have requested a joint investigation be carried out with the police."
A Government ruling to save the landmark building by listing it was met with dismay by residents who view it as an eyesore.
The school, which dominates Seaside Lane, was built in 1911.
Westnew Developments, which bought the premises in 2003, had applied for planning permission to replace it with 39 residential units.
But following opposition from English Heritage, The Victorian Society and regeneration charity application went to public inquiry - resulting in a ruling in 2007 that the building must not be
Anyone with information about the fire should contact the police on 101.