The flames broke out around 7 p.m. at Beach 92nd Street and Beach Channel Drive.
It took about an hour and half for crews to get the power back on for most people who had lost it.
Homeowners who spoke with NY1 didn't let the blackout get in the way of their Sunday plans.
"I was able to put the telephone on, my cell phone, just to listen to the end of the game that was on. So at least I have something like that going," said one resident.
"We heard boom and zzzzzz you know and we were in the kitchen and looked out the window and saw red in the sky," said another resident.
It's still not clear what caused the transformer fire.