Witnesses were shaken after the incident unfolded in less than two minutes.
Video shows the rapid sequence of events, from a man stopping with the bike to smoke rising and then flames igniting.
"Next thing you know, this guy comes in a bike, and I see smoke, so I rolled down my window and said, 'Are you OK?'" one witness said.
The fire began when the battery on the e-bike started smoking before bursting into flames. A woman who witnessed the incident described the moment the battery ignited.
"He tried to grab the tank, but it was too hot. When he dropped it, that's when the fire started; it exploded. It kept going. Things were just flying, pieces all on fire," she said.
Another person nearby attempted to help put out the flames.
"Someone driving tried to use my hose to turn the fire off, but it was too strong," the witness said.
Philadelphia firefighters arrived shortly after and took control of the scene.
It remains unclear what caused the battery to begin smoking and catch fire.
No injuries were reported.