The incident happened after two helicopters dropped off cargo and passengers a few miles north of Sangin.
Shortly after take-off the four-strong crew of one Chinook saw cockpit indications of an engine fire during take-off.
The pilots skilfully continued to manoeuvre the helicopter about 1km away from the danger zone to safely make an emergency landing.
All four crew onboard managed to evacuate the aircraft safely. They were recovered by the second helicopter which took them out of the area.
The helicopter was later deliberately destroyed by a coalition airstrike to deny it to enemy forces.
Lieutenant Colonel Nick Richardson said:
"It is a measure of the bravery and skill of the pilots that, operating under enemy fire, they were able to complete their task and calmly move to safety.
"Their cool under pressure has ensured that their lives were saved and minimal damage was caused. Despite the loss of one aircraft, the brave crew have thwarted insurgents' attempts to destabilise the elections with a shocking spectacular loss of British life."
The exact cause of the incident is still under investigation and enemy action has not yet been ruled out.
In the very short term other UK aircraft in Regional Command (South) and those operated by our NATO partners will be able to cover the helicopter lift requirement. As part of the routine programme to sustain our Chinook fleet in Afghanistan, an additional Chinook had already arrived in theatre.