That is tough and it depends... Pretty much, as builder said, the basics are this:
-you shift the pixels up one
-you give it a chance to disappear (For example, 1/8 chance)

Depending on the sprite situation, you will probably have to use 2 For( loops to check each pixel of the sprite as well as giving it an upper limit (like the flames can only go as high as another 8 pixels)

okay, I am not sure if this will work as I am not much of an Axe coder, but maybe try this?

For(B,X,X+7
For(C,Y+1,Y+15
pxl-Test(C,B→A
pxl-Off(C-1,B
If rand^8
pxl-On(C-1,B
End
End


Oops, let me modify that :

For(B,X,X+7
For(C,Y+1,Y+15
pxl-Off(C-1,B
If rand^8*pxl-Test(C,B
pxl-On(C-1,B
End
End


It burns the pixels below the block. You'd have to do this:

44->X-16->Y

Repeat getkey(15)
 Pt-On(X,Y,[FFFFFFFFFFFFFFFF
 For(B,X,X+7)
  For(C,Y-7,Y+7)  //I changed this line
   Pxl-Off(C-1,B
   If rand^8*pxl-Test(C,B)
    Pxl-On(C-1,B
   End
  End
 End
 DispGraph
End
No guarantee, but I hope it works.

Yeah, ninja'd again.

So did my code work, otherwise?

Yes, that's a great code, thanks and you can make the flame longer by changing the second For loop (and I found that rand^6 is better than rand^8)

The number you subtract in the for loop is the height of the flames -1.
This would make the flames 16 pixels high
For(C,Y-15,Y+7)
Changing the modulus at the rand will change the density of the flames. A high number like 8 or 10 will let the flames have more particles than having a small number like 4 or 6.

If rand^10*pxl-Test(B,C)  //High density = more particles
...
If rand^4*pxl-Test(B,C)  //Low density = less particles