The sequential inverse method of locating and sizing accidental fire in a compartment is developed in this paper. The prediction procedure in this study includes two parts: the first is to simulate fire plume and ceiling jet flow by using the FDS model, then the result of temperature field at specified measurement sensors are utilized to predict the heat release rate and location of fire by the proposed method. A few examples are used to demonstrate the efficiency of the proposed method. The predictions show that the proposed method is capable of estimating the transient heat release rate of fire. The accuracy of the heat release rate of the fire is sensitive to random error and systematic error. Furthermore, the proposed method is noniterative and cost effective.