The car burst into flames on the westbound carriageway between junction two and three of the motorway at about 5pm, halting traffic during rush hour.
Cars remained stationary back towards the M6 as well as on the link road to the A449 in Wolverhampton for two hours, until traffic slowly started moving just after 7pm.
WATCH: Footage of the blaze (no audio)
Firefighters from Shropshire Fire and Rescue Service and West Midlands Fire Service were battling the flames on the hard shoulder between Wolverhampton and Albrighton.
A spokesman for Highways England said that the road had to remain closed after the fire was extinguished because of a fuel spillage.
At 6.30pm he said: "There was a car on fire on the M54 between Junction 2 and 3 towards Telford.
"The fire was extinguished but there was an oil spillage on lane two so they're working towards opening lane one, which should open imminently.
"There are delays of about 30 minutes at the moment."
A spokeswoman for Shropshire Fire and Rescue Service said: "We're in attendance, it's a West Midlands Fire Service job, we're there to help.
"As far as I'm aware there are no casualties."