If you ever witnessed a fire in an exhibition hall, you understand, why organizers and hall owners try everything to avoid this.
The whole hall gets filled with smoke. Ashes pour down on other booths and the aisles and the water to put the fire out spreads to neighbors. We have seen it once in a nearby hall during set up. It's a mess, we would rather not experience during opening hours, when panicking exhibitors and visitors make it more messy and dangerous.
Thankfully fires happen very seldom because of regulations and other prevention measures.These regulations among others call for all building materials to be fire resistant or of low flammability. All materials used on events all over the world need to have some kind of certification or proof for their fire resistance. Especially for materials, that look as if they go up in flames easily, it is more likely to be checked by a fire marshal. There are though back drop papers and thin textiles used for graphics or partitions or ceilings, which are treated chemically to meet the safety standards. Nothing an exhibitor has to worry about, as all service contractors know and abide these rules.
But if you bring your own exhibits, that might conflict with these rules, it is probably a good idea to confirm how to handle these in advance. All show manuals contain a section, that gives clear information about dangerous materials.
There are rules, which might interfere with your ideas of your booth: For example on some venues, doors to meeting rooms need to have a window, that gives a view to the outside in an emergency. In that case, you will not be allowed to make a completely closed room, even, if you preferred this for privacy reasons. Double story stands often have very strict rules about the stairs, because these are seen as emergency exits from the upper floor. In some instances fire safety rules will be the reason for costs, which need to be calculated in the budget, if smoke detectors or sprinkler systems need to be installed.