Singapore's air quality reached "very unhealthy" levels on Thursday as thick smog from forest fires in Indonesia's neighbouring island of Sumatra choked the city-state.

Thick grey smoke blown in by southerly winds smothered the island, shrouding the skyline and creeping into homes, with many residents avoiding going outdoors.

"The hazy conditions in Singapore have further deteriorated since last night, as denser haze from Sumatra has been blown in by the prevailing southerly winds," the National Environment Agency said in an advisory.

It showed the Pollutant Standards Index, which measures the air quality, as reaching the "very unhealthy" range.

The agency advised healthy persons to "avoid prolonged or strenuous outdoor physical exertion" and urged the elderly, pregnant women and children to minimise outdoor exposure.

Housewife Asnah Mohamad, 62, said she and her friend used their headscarfs to cover their face as they travelled to a mosque to celebrate the Muslim holiday of Eid al-Adha.

"My husband cannot leave the house because he has a heart condition so I represented him to collect the meat offerings," she told AFP, referring to the festival in which Muslims share the meat of a goat or sheep slaughtered as sacrifices.

"We hope it gets better soon. But what can you do? Go over there (to Indonesia) and pour water on the fire?"

The city-state, which prides itself for its clean environment, has been cloaked in the haze in varying degrees for about three weeks, the worst such episode since mid-2013.

But Southeast Asia's worst bout with haze was in 1997-1998 when the smog caused an estimated $9 billion in losses in economic activity across the region.

The haze situation has been made worse this year by an El Nino weather system, which produces tinder-dry conditions in Indonesia and increases the risk of fires.

Under pressure from its neighbours to stop the annual haze, Indonesian President Joko Widodo has pledged to crack down on companies and individuals behind the burnings, which are a cheap but harmful way of clearing vast tracts of land for plantations.

During a visit to the haze-affected islands of Borneo and Sumatra this week, Widodo called on local communities to do their part in helping contain the scourge.

"I'm taking this opportunity to ask the community not to carry out burning, whether at the farms, in their own yards or on the streets," Widodo told reporters.

He said the government was trying its best to extinguish the fires by dropping water from helicopters and inducing rain through cloud seeding.

Indonesia's National Disaster Management Agency told AFP that 2,081 fire "hotspots" were recorded in the worst-affected region of Indonesia's Kalimantan and 290 in Sumatra on Thursday.