The hole appeared in Pond Street during this morning's rush-hour, and a Veolia spokesman has now confirmed that the hole was caused as a result of the 'Sheffield District Energy Network developing a leak'.
Emergency repair work is currently underway, and while traffic is being diverted around the site of the hole vehicles are able to travel up Pond Street as normal.
Heat customers are expected to be impacted however, as an 'emergency isolation' is put into place while the repair work is carried out.
A Veolia spokesman said: "Veolia are currently making this safe and are carrying out an emergency isolation.
"This will have an impact on our heat customers in this area, and these are currently being informed by Veolia.
"We apologise for the disruption in the area and hope to resolve this as soon as possible.
"While these events are rare, we would ask If people do see these kind of incidents in the road, to report them to us on 0114 273 4567."