Briton Jenson Button pulled over with smoke and flames coming from his Honda's engine in final free practice for Sunday's Hungarian Grand Prix.
Red flags were brought out to allow marshals to clear oil from the track, leading to a 15-minute suspension of the session.
Button will lose 10 places on the starting grid if he has to have his engine replaced for qualifying, which looked likely as mechanics were preparing the spare car.
When practice resumed, seven-times champion Michael Schumacher lapped in one minute 20.795 seconds -- the quickest of the weekend -- ahead of Brazilian team mate Felipe Massa in a Ferrari show of strength.
German Schumacher, 11 points behind Renault's world champion Fernando Alonso, has won the last three races and is looking to slash the Spaniard's lead further at the Hungaroring on Sunday.
Alonso, with a two-second penalty to be added to his best laps in qualifying after a flash of road rage in Friday's practice, was fifth quickest but 1.324 seconds slower than Schumacher.
The penalty means the 25-year-old is unlikely to qualify in the top 10 on the grid at a track where overtaking is notoriously difficult.
Poland's Robert Kubica, replacing Canadian Jacques Villeneuve at BMW Sauber after the 1997 champion told the team he had not recovered from a crash in Germany last weekend, was third fastest on an overcast morning.
McLaren's Kimi Raikkonen, last year's winner in what Finns have come to consider a home race, was 10th quickest with team mate Pedro de la Rosa eighth.