The fire broke out at 3.30pm (GMT) on Friday, February 22 and rapidly took over the tailgate area of the mine.
The fire began in the tailgate of the 32s face, at a depth of 520m and a distance of 8km from the bottom of the main shaft.
In a statement UK Coal said it safely evacuated 92 underground workers from the mine, leaving a specialty force of 14 workers to fight the blaze.
However, due to the increasing severity of the fire, all workers were safely evacuated from the site at 9pm.
Ventilation to the mine was switched off at 10.45pm to reduce the oxygen levels in the mine and starve the fire.
A core team remains at the mine to bring the situation under control and achieve an orderly close-down of operations.
Daw Mill has been at risk of closure since UK Coal underwent a restructure in March 2012.
The mine was awarded medium-term security providing it was able to produce coal safely, reliably and efficiently.
“The fire puts that security for Daw Mill seriously in doubt and the company will consult over the coming weeks with the workforce on the implications for them,” the company statement said.
UK Coal chief executive Kevin McCullough said the fire was on a scale not seen for decades.
“I want to thank everyone in the mine that day for their professionalism and commitment,” he said.
“From the mine workers that fought the fire initially to the mine management team that evacuated all the workers safely – everyone played their part.
“The suddenness of the fire and its ferocity is something we train for and hope never to see, so the safe evacuation of over 100 miners is something the whole team can be proud of.”
It is unclear why the fire broke out but the company stated that all parts of the mine were regularly inspected by the UK Health and Safety Executive and the part of the mine affected was inspected only two days before the fire.