This is a very simple process that can look very effective in maps.
First thing to do is create somewhere for the fire to burn, a few bits of wood and a scorch decal did the trick for me
Now use the Entity Tool (Shift+E) and select env_fire from the list, place it neatly over the chosen burning area, like so:
There is quite a lot to fiddle with in the options and flags, but what's important is the one named "Ignition Point". Set it to about 5 and you'll see why now.
The fire doesn't appear instantly, it needs to be lit so to speak, so we need another entity called env_firesource.
This basically generates a "heat" and all env_fires in it's radius will light as long as the heat provided by the env_firesource is high enough to trigger the Ignition Point.
So ensure the env_firesource covers the env_fire by changing the radius and set the Intensity / Damage to be higher then the ignition point in the env_fire, so 10 will do here for instance.
So now the fire will burn and it will also produce smoke, but to add that little touch try using a brush-based entity called env_embers, it basically creates some ember effects for the flame.
To create it you need to place a block covered in the nodraw texture above the flame, and then make it an env_embers with Ctrl+T. You can set various things in the properties to get the right effect.
I also added an orange light for that perfect touch.