The yacht was just off the beach at Pampelonne in France when it caught fire.
Captured by an onlooker from the shore, the video showed thick plumes of dark grey smoke billowing out of the luxury vessel.
Pampelonne beach is an area frequented by celebrities, with Keeping up with the Kardashians star Kris Jenner recently enjoying a yacht holiday there with her boyfriend Corey Gamble.
Sir Elton John, Elle MacPherson, Kate Moss and Paris Hilton have also been spotted at the popular holiday destination.
Up to 30,000 people visit the beach each day in peak summer months.
Flames engulfed the 65ft boat at 6.30pm on Monday, while many tourists were still on the beach enjoying the sunshine.
The luxury yacht, which was sailing a Belgian flag, was owned by a Flemish businessman.
According to local media, the blaze was caused by “a technical defect in the lower deck”.
Other boats in the area soon approached the yacht to save people onboard.
Thankfully nobody was injured in the fiery scene.
Everyone managed to escape before the entire yacht was quickly devoured by flames.
One image showed the captain diving into the sea in panic as the fire broke out.
