In this paper we show the suitability of a miniaturized tunable diode laser spectroscopy (TDLS)-based carbon-monoxide (CO) sensor for fire detection applications. The sensor utilizes a vertical-cavity surface-emitting laser (VCSEL) and inherent calibration scheme with reference gas filled in the photodetector housing. The fire-detection experiments are carried out under realistic conditions as described in the European standard EN54. The CO generation of all class C fires (according to EN54) could be well resolved. The cross-sensitivity to other substances was found to be very low: the maximum CO false response from cigarette smoke, hairspray and general aerosols reaches a low value of a few μL/L and only if the substance is directly applied into the sensor gas inlet. Therefore this sensor overcomes the disadvantage of high false alarm rate given by smoke detectors and is also in small size which is suitable for household and industrial applications. Hence, the VCSEL-based TDLS sensor is shown to have sufficient performance for fire-detection. It has advantages such as capability for fail-safe operation and, low cross-sensitivities as compared to existing point fire detector technology which is presently limited by these factors.