The cause was a transformer explosion at a Con Edison power station in Astoria, Queens, about 9:30pm local time.
The lights caused a stir on social media as several witnesses posted photographs and videos of a bright, blue flash that filled the night's sky.
The fire caused scattered power outages across the city stalling some trains and triggering a brief blackout in LaGuardia Airport.
All Federal Aviation Authority facilities were on generator power, FAA spokesman Greg Martin said.
"We received numerous 911 calls, one that reported a plane crash", said NYPD Deputy Inspector Osvaldo Nunez.
Hydro crews work around the clock to restore power to British Columbians
Uprooted trees, snapped power lines and debris forced the closure of several streets and highways along the southern coast. She says field crews surveying the damage on Vancouver Island have said some areas are "complete devastation".
The explosion spawned a lot of social media reaction and led to a power outage necessitating the temporary shutdown at LaGurdia Airport.
Con Ed is still monitoring the situation saying, "All power lines serving the area are in service and the system is stable".
Street in Astoria, Queens after a transformer fire at a nearby Con Ed plant. "Many flights are departing, some are not", the airport wrote on its Twitter account, later adding that power was back in "all terminals" and advising passengers to check with airlines for flight status information.
However, the reality was far less inspiring as the blue light had risen after an electricity transformer exploded at ConED Plant in Queens, New York.
"If I go back to NY and I see that aliens have taken over, they better erase my student debt", wrote a woman on Twitter. Television host Keith Olbermann referred to the episode as the "Blue Light Special".
New York Governor Andrew Cuomo said crews were working to fully restore power "as soon as possible", but he did not offer a timeline.