Troops have been drafted in to help firefighters battle the blaze, which currently covers some 900 hectares in Artenara, about 20 miles from the capital Las Palmas, Sky news reported.
Helicopters and planes are being used to drop water on the flames in a bid to tackle the raging inferno.
The fire poses a threat to several towns as well as the Tamadaba national park on the west of the island, according to the authorities.
It had initially been thought the fire, which started on Saturday, had been brought under control, but it flared up again on Sunday morning.
The Gran Canaria fire brigade tweeted: "We are overwhelmed by the situation. We continue working and fighting for our island."
Witness Carla Rodriguez described the scene of destruction as "one of the most painful images I've seen in my life".
The plume of billowing smoke from the fire was visible across the island and from neighboring Tenerife.
A 55-year-old man has been arrested in connection with the blaze, thought to have been started by a soldering iron.