The incident happened this afternoon between Kinglassie and Glenrothes.
Diversions are in place and police are assisting with traffic management.
A spokesperson for Stagecoach East Scotland said: "After noticing smoke coming from the back of the vehicle, our driver pulled over, called for assistance and evacuated the passengers from the vehicle. S
“Shortly after, the driver noticed flames. He immediately called the Fire Service who arrived shortly after and contained the incident.
"No passengers were injured and they were transferred onto another vehicle to continue their journey.”
A spokesperson for the Scottish Fire and Rescue Service said: “We were alerted at 2.15pm on Wednesday, October 14 to reports of a bus on fire on Main Street, Kinglassie, Fife.
“Operations Control mobilised two fire appliances to the scene and firefighters are working to fully extinguish the flames.
“There are no reported casualties.”