The incident happened in Deeny Drive in the Kilwilkie estate about half an hour ago.
This is a built up area where children often play in the street.
It is unclear at this stage what caused the fire in the car at Deeny Drive.
Sinn Fein Cllr Keith Haughian condemned the two attacks on vehicles in North Lurgan.
“Two cars have been set alight in the area over the past 48 hours. In both cases they could have caused injury to residents or children living nearby.
“It is reprehensible that anyone would have such disregard for our community to endanger them in this way.
“I would ask anyone with information on who is responsible to come forward to the police.”
The NI Fire and Rescue Service extinguished the blaze and the PSNI is now at the scene.
A spokesperson for the NIFRS said it was called to Deeny Drive in Lurgan at 10.49am.
One fire appliance arrived from Lurgan.
“Firefighters were called to a vehicle on fire. Firefighters wore breathing apparatus and used two hose reels to extinguish the fire. The incident was dealt with by 11.09am and the cause of the fire is believed to be deliberate ignition.”
A PSNI spokesperson said: “Police received a report of a car being set on fire in the Deeny Drive area of Lurgan this morning, Monday, 20th June, shortly after 10.50am.
“Police Service of Northern Ireland officers attended the scene along with colleagues from Northern Ireland Fire and Rescue Service, who extinguished the blaze.
“The fire is being treated as arson at this stage and enquiries into the circumstances surrounding this incident are ongoing.
“Anyone who was in the area at the time and saw any suspicious activity, and in particular anyone who may have any dash-cam or other footage, is asked to contact police on 101, quoting reference number 644 of 20/06/22.”
Earlier this morning in a separate incident another car was damaged in a petrol bomb attack.
In relation to the first attack a PSNI spokesperson said: “Police are appealing for information following a report of a petrol bomb incident which occurred at the Bells Row Court area of Lurgan this morning, Monday 20th June.
“Shortly before 2:40am, it was reported that a petrol bomb had been thrown at a car which was parked in the area. Damage was caused to the vehicle and smoke damage was also reported at the front of a property near by following the incident.
“There were no reports of any injuries, and the item was taken away from the scene for further examination.
“Enquiries are ongoing, and police are appealing to anyone who may have seen any suspicious activity in the area at the time, or have any information which could assist, to contact them on 101, and quote reference number 173 20/06/22. Information can also be provided to Crimestoppers anonymously on 0800 555 111 or online at www.crimestoppers-uk.org.”
A spokesperson for the NIFRS said they were called to Bells Row Court in Lurgan at 2.36am.
Two Fire Appliances from Lurgan Fire Station attended the incident.
A spokesperson said; “Firefighters were called to rubbish on fire that had spread to the door and porch of a house. Firefighters used 1 hose reel to extinguish the fire. The incident was dealt with by 2.57am and the cause of the fire is believed to be deliberate ignition.”