Marilyn Robertson was in the lounge with her 20-year-old daughter Emma and her friend Bev Shepherd, 19, when the drama unfolded yesterday afternoon.
Police are investigating the suspicious blaze at Arthur View Terrace, Danderhall, which left the women shaken but otherwise unharmed.
Ms Robertson, 48, a sales assistant, said: "I heard a bang followed by what sounded like footsteps in the hall and I went out to take a look.
"I saw the hallway filling with smoke and there were flames outside the door so I shouted to the girls and we all ran outside."
Neighbours saw the women running screaming from the property and called the fire brigade just after 3.10pm.
Ms Shepherd, a barmaid, said: "It was a bit of shock. We weren't sure what was going on. When we got outside someone said a petrol bomb had hit the house."
Police and the fire service are investigating the blaze.
Ms Robertson said: "The police haven't said much and they'll have to do an investigation."
Fire crews were able to extinguish the fire quickly before the flames spread to the rest of the two-storey terrace.
The front door was destroyed and the front of property was blackened by the rising flames.
Although everyone in the ground floor property and the house above were evacuated before the fire engines arrived, fire crews still found time to rescue the family goldfish.
The previously unnamed goldfish has now been named Lucky and was moved from its tank in the hall inside a water jug.
Meanwhile, Ms Robertson said she had turned down the council's offer of temporary unfurnished accommodation while her home of 20 years is repaired and would be staying with family.
Police confirmed they were treating the fire as suspicious.
Officers from CID yesterday took the women to a neighbour's house, where they were questioned for around two hours on the circumstances of the fire.
A spokesman said: "Three people got out of the home and no-one was injured.
"The investigation is ongoing so it is too early to establish a cause. We are waiting for investigators to complete their examination."
Watch manager Duncan Wilson, of Newcraighall Fire Station, said: "It will be up to the fire investigation team to determine the cause. We were more concerned with putting out the fire.
"There were no persons reported when we were sent to the scene, with the occupants having escaped through the back door.
"The front porch area and hallway are extensively damaged, while there is smoke damage to the rest of the house."
A police spokesman said: "A 21-year-old man has been arrested and charged in connection with a suspicious fire in Arthur View Terrace in Danderhall.
"Police are following a positive line of inquiry in relation to a second suspect."
The arrested man is expected to appear at Edinburgh Sheriff Court tomorrow.