The fire broke out at the Student Lodge on Player Street on Monday afternoon.
Fire group manager David Stevenson said it was proving to be a "very difficult fire to tackle because of a number of hidden voids" in the old building.
Students were evacuated on Monday. Residents of nearby terraced housing are now being moved as a precaution.
Flames could be seen coming from the roof of the building in Radford earlier.
Mr Stevenson said a cordon around the scene had had to be widened because high winds were blowing around debris.
The fire is thought to have started between the third and fourth floors.
Part of the building is occupied, but about three quarters is still under construction. Builders who were working on the site were evacuated on Monday.
Crews from Leicestershire and Derbyshire are also at the scene.
The accommodation block is owned by a private landlord.

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Carey's penalty in the second period of extra-time sealed a 1-0 win at Newport County in a dour second round replay.
"We're going to go there and try and get a result," 27-year-old Carey said.
"No-one will give us a shot at getting a result, but we've showed we can battle as a team and it's the FA Cup so you never know."
The win meant the Pilgrims, who were beaten in last season's League two play-off final, reached the third round of the FA Cup for just the second time since 2010.
"My whole family are mainly Liverpool fans, so I'm sure some of them will make the trip over," added the Irishman, who is rated as one of Argyle's top players, having scored 10 goals in 27 games this season.
"It's a great win for the club and as a team we stuck together and dug it out.
"We're getting stronger and harder to beat, we had our bad patch, but hopefully we can go on a run now because we're full of confidence and we've started to learn how to grind games out.
"The main aim this season is to get promoted - we can enjoy that day (at Liverpool) when it comes - but first of all we need to go back to the league and rack up more points and that's what we'll do, but the FA Cup won't be a distraction whatsoever."
Argyle striker Ryan Donaldson will miss the tie at Anfield with a broken jaw.
The 25-year-old was injured in an accidental clash in training ahead of the Newport replay.
"It's really disappointing for him as he'd got himself into the side," boss Derek Adams said.
Fellow forward Jimmy Spencer is also on the sidelines after he broke his ankle in a training ground slip.

The man said he shot at their car after they refused to stop when he challenged them on Saturday. They were not hurt.
He said that earlier he had heard the pair say "did you get anything"?
Police in Florida have used the incident as an opportunity to issue guidelines for teenagers and parents on safely playing the game.
Police say they received a call from the parents of one of the teenagers when it was noticed later that bullets had caused a flat tyre, News4jax reported.
The parent said the teenagers did not realise they were being shot at, and thought that the man was only trying to scare them.
The guidelines issues by the Flagler County Sheriff's Office include best practice tips for Pokemon Go players. They advise players to:
The sheriff's office also advises parents of Pokemon Go players to:
According to data from SimilarWeb, people are now spending more time playing Pokemon Go than they are on Snapchat, Instagram and WhatsApp.
The game has also been installed on more Android smartphones in the US than the dating app Tinder.
About 60 firefighters are still at the scene of a blaze at a student accommodation block in Nottingham's former Player's cigarette factory.
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Liverpool-supporting Plymouth Argyle midfielder Graham Carey hopes they can cause an FA Cup upset when they visit Anfield in round three.
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Two teenagers playing Pokemon Go late at night in their car in Florida were shot at by a householder who mistook them for burglars, police say.