Helicopters and other aircraft have already flown out 53 of the most vulnerable residents of Burketown, home to about 200 people in northeastern Australia, the authorities said.
Murky water lapped at the sides of buildings and transformed wide areas of land into lakes, with only the tops of trees visible, television images of the Queensland town showed.
"We are strongly urging all remaining residents to leave the community of Burketown as soon as possible," Queensland police said in a statement posted on social media.
The elderly and young children were a priority for evacuation, they said, adding that sewerage systems had been "compromised" and power would be cut off later in the day.
"It is not safe for people to remain," police said.
There were "probably" 100 people left in the town, which lies about 1,600 kilometres (1,000 miles) from the Queensland capital of Brisbane, said state police superintendent Tom Armitt.
Helicopters were ferrying more people out during the day, Armitt told national broadcaster ABC.
Following heavy rains, which have since eased, the town's Albert River has topped a March 2011 record of 6.78 metres (22 feet), Queensland's bureau of meteorology said.
The river rose to more than seven metres on Friday, and was not expected to peak until Sunday, the forecaster said.
Australia has been lashed by heavy rain in the past two years, driven by back-to-back La Nina climate cycles over the Pacific.
But the national bureau of meteorology has predicted "drier and warmer" weather in the months ahead as La Nina nears its end.
An east coast flooding disaster in March last year - caused by storms in Queensland and New South Wales -- claimed more than 20 lives.
Flash floods swept through parts of eastern Australia later in the year, forcing evacuations in Sydney in July and tearing homes from their foundations in some country towns in November.
Australian researchers have repeatedly warned that climate change is amplifying the risk of natural disasters.
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