The Gunners were on the runway at Germany's Braunschweig Wolfsburg Airport when the team heard a loud bang before the pilots saw the blaze and pulled up the plane.
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They quickly abandoned take off and evacuated the plane which included Arsenal's players and backroom staff.
According to German newspaper BILD, as quoted by The Sun, a bird strike on the engine had caused the fire, but thankfully no one was injured in the incident.
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The team were in Germany for their Champions League semi-final clash with VFL Wolfsburg, a match which they drew 2-2.
But while they were unable to get a flight back on Sunday after the match, the team have since made it back to London safely after catching a replacement flight.
A statement from Arsenal read: "Our aircraft developed a technical issue prior to take-off in Germany on Sunday evening.
"As a result, we remained in Wolfsburg overnight on Sunday before flying back to England on Monday afternoon.
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"We would like to thank the staff onboard the aircraft and on the ground at the airport for their assistance."
Arsenal will welcome Wolfsburg to London a week on Monday for the second leg of their Champions League semi-final clash.
The winner of that will face either Barcelona or Chelsea in the showpiece event at Eindhoven's PSV Stadium on June 3.