Israel called on Greece, Italy, Cyprus and Russia to send aircraft to help battle the blaze, raging out of control on hills approaching the city of Haifa more than seven hours after it started.
"It's a disaster on a scale that we have never seen before," premier Benjamin Netanyahu said.
More than 1,000 people were evacuated from towns and villages as the flames leapt through dense pine woodland, fanned by strong winds. A collective farm, Kibbutz Beit Oren, was razed to the ground and TV showed pictures of a bus and car, which had been carrying prison guards and rescuers when they were engulfed by the flames.
"There are a lot of casualties. We are talking of about 40 people," said police minister Yitzhak Aharonovitch. Israeli media said it was the biggest forest fire in its history, with some 7,000 acres destroyed. Some 500 inmates from Damon prison were moved to safety.
Guards had been attending a course at the jail and had been driven straight into the flames, an official said.