The explosion at 9pm the Organo Fluid chemical waste facility was heard for kilometres around as its pressure wave shattered nearby doors and windows and stripped off roofs.
“Just when we were thinking about what that might have been, the first emergency calls came in,” said Bremen fireman Karl-Heinz Knorr.
The fire - around 15 kilometres north of Bremen - destroyed the premises of a specialist waste disposal company and some nearby homes. Flames could be seen lighting up the sky for miles around.
Around 350 members of the emergency services were deployed to respond to the blast. Firemen were pumping up to 7,500 litres of water per minute onto the blaze.
Police said that one employee of the company was badly wounded and was taken to hospital. "He had severe burns and was not responsive," a police spokesman said.
At least two other people suffered less serious injuries and another employee of the company is believed to be missing. The missing man has been identified as a 60-year-old from nearby Osterholz-Scharmbeck. He had gone into the building to investigate a technical error just before the explosion. Investigators have only found his car outside the factory.
Several people in homes nearby also suffered cuts from flying glass and 20 were brought into a hastily-assembled treatment centre.
Between 30 and 40 houses were affected, with some standing just 20 metres from the centre of the blast. Some are in danger of collapse.
Train services were suspended on a nearby track as overhead cables were damaged.
All nearby buildings have been evacuated and a large area surrounding the fire has been cordoned off by the police. Many residents in the town of just over 14,000 people were standing on their balconies or joining groups gathering in the street. All were asking why the company had been allowed to operate so close to their homes.
“We were always worried about that company,” said Ritterhude mayor Susanne Geils. “I knew immediately that something had happened in the neighbourhood and where it must have been.”
People in the area have protested in the past against the facility. In 2010, the Weser Kurier newspaper reported that people in the town were concerned about flammable substances being stored in the facility.
Emergency services will sift through the wreckage on Wednesday and investigate the cause of the explosion.