The curtain caught fire.

Literal

Curtain [target-に] fire [subject-が] lit.

Similar to 火がつく but with 点く (つく), a reading-variant kanji more specifically used for lights and fires igniting. 火が点く = 'fire lights (attaches).' Compare with the transitive 火をつける ('to set fire to'). The に marks the location where the fire started, not the target of an action.