Emergency services responded to fire at a two-storey house on Naying Drive, Pemulwuy just before midday.
The critically injured man, and another 26-year-old man, were naked as they ran out of the burning house, their clothes burnt off by the flames.
Neighbours used their garden hoses to douse the men in water before paramedics arrived.
CareFlight’s medical team treated the severely burnt man on scene before he was taken by road ambulance to Royal North Shore Hospital.
He is in a critical condition.
The second man is in a stable condition at Concord Hospital after being transferred from Westmead Hospital.
Police set up a crime scene and said they are treating the cause of the fire as suspicious.
NSW Ambulance, NSW Police, Fire and Rescue NSW and other emergency services were also at the scene of the blaze.
Police recovered a mobile phone in a nearby waterway, believed to have been thrown by one of the men soon after the blaze broke out.
A dog was also rescued from the blaze, with firefighters and paramedics administering first aid and oxygen to the animal before it was taken to a vet for further medical treatment.
Firefighters said the dog was alert following the incident.
Meanwhile, another man suffered serious burns and a number of units have been destroyed in a fire in Sydney’s northwest.
Emergency services were called to the blaze in Ermington at about 7pm on Friday following reports of an explosion at a unit.
Firefighters extinguished the blaze which had spread to neighbouring units in the same complex, prompting the evacuation of more than 40 people. A 51-year-old man from the unit where the fire originated suffered serious burns and was taken to hospital along with a man from another unit who suffered smoke- inhalation.
Police say an investigation is underway but it has not yet been determined if the fire was suspicious or not.