The State Emergency Service sent out an emergency alert to residents in the worst-affected town, Tallygaroopna, north of Shepparton, about 7.30am instructing them to leave their homes.
The alert comes after emergency services helped rescue people trapped in their homes and cars in surrounding areas Mooroopna North and Cobram East.
A spokeswoman for the SES said they believed flood waters in Tallygaroopna would continue to rise to potentially damaging levels.
She said Tatura, south-west of Shepparton, and Yarrawonga, to the north-east, were also on high alert but residents had not yet been told to evacuate.
"We issued an emergency alert [in Tallygaroopna] because we believe the flood waters may rise in that area," she said.
"We've had about 120 calls for assistance in the north-east region in the last 24-hours. Most requests were for sandbagging."
The SES spokeswoman said about 300 people live in the Tallygaroopna area, where up to 70 millimetres of rain had fallen.
A spokesman for the Bureau of Meteorology said heavy rain would continue in the area before clearing to the far north-east late this afternoon.
‘‘There is the potential for further flash flooding because of heavy rain. Most of the area will clear eastwards as the morning progresses, reaching the far north-east by this afternoon,’’ he said.
The bureau has also forecast heavy rains for the region on Saturday. Properties in rural NSW have also been evacuated and families in others are preparing to move out as much of the state is ravaged by flood and severe weather.
Seventy people were evacuated to the library in Cowra overnight and evacuation warnings were also sent out to Goulburn and Cooma where around 100 properties are affected and a major flood watch is in place.
A Country Fire Authority spokeswoman said six homes and the hotel in Tallygaroopna had been flooded.
She said firefighters had helped rescue people trapped by flood waters in the area overnight.