Well, it would help to be more specific in what you say and perhaps provide some screenshots. Not much to help with if you just say you configured it as you should or use vague sentences. (What is a “Local proxy of localhost”? “Proxy in burp suite …, yet it states…” suggest that Burp Suite is giving the error and not Firefox.)
Make sure you are configuring the Proxy Listener in Burp Suite, not the Upstream Proxy Servers. Test with netstat and telnet that it is actually listening. Make sure your firewall isn’t blocking things.