CFA was called to the scene at Elliott Road just before 4pm.
The shed, which is around 30 x 30 metres in size, was well alight when firefighters arrived.
Operations Officer Paul Carrigg said firefighters did a great job bringing the fire under control within 30 minutes.
“As a result of the fire, the shed is extensively damaged and the contents are destroyed,” he said.
“The cause will be investigated but the fire is not believed to be suspicious.”
The shed contained cars, forklifts and car-parts.
11 CFA trucks from Dandenong, Keysborough, Patterson River, Hallam, Carrum Downs and Springvale attended the incident.
Crews are expected to remain on scene for a while blacking out.