It took firefighters about five hours to bring the blaze under control, with the historical structure gutted by the inferno.
Fire and Rescue New South Wales video of suspicious Yass Commercial Hotel Fire.
The blaze broke out at the Commercial Hotel in Yass, in the Southern Tablelands, just before 2am Monday.
Firefighters worked for about five hours to bring the inferno under control.
About 40 firefighters attended and managed to stop the blaze spreading to neighbouring properties, including a carpet store.
A specialist Fire and Rescue NSW aerial pumping truck was also called in so the fire inside the two-storey building could be attacked from above.
After six hours the blaze was finally extinguished, and an exclusion zone was established over fears walls could collapse.
Only the shell of the building remained as of Monday afternoon, with fire investigators heading to the scene.
No injuries were reported from the scene.
The Commercial Hotel was built in the 1840s, and first received its liquor license in 1850.
However, the building had fallen into a state of disrepair since it stopped operating in 2005.
Yass Valley Council moved to remove the building’s veranda in March last year.