Mayor of Rockhampton, Brad Carter, has praised the community's resilience and camaraderie
The Fitzroy river which flows through the Queensland city is at 9.2m (30ft) and expected to hit 9.4m, having already swamped hundreds of acres.
The state is in the grip of a flood crisis, with some 40 communities hit and 1,200 homes submerged.
A taskforce has been created to lead recovery efforts. Officials say the flood bill could exceed A$5bn (£3bn).
Queensland Premier Anna Bligh has appointed Maj Gen Mick Slater to head the taskforce.
At the scene
Travelling by boat through one of Rockhampton's flooded suburbs you get a sense of not only how widespread the flooding is but the reasons why people are staying put.
This is a flood-prone area. They saw major floods here in 1954 and 1991, and because of that the houses are built on stilts - so the flooding comes under the house rather than into the house.
People here are sat on the verandas, they are reading the papers, having a cup of tea, and listening to the cricket. They are very reluctant to leave.
Another reason for that is because some people here have heard reports of sporadic looting, although the police say the crime levels are no worse than normal.
Ms Bligh says the scale of the disaster was unprecedented and would require an unparalleled rebuilding effort.
"This is a very serious job ahead of us recovering from a disaster like this. Rebuilding regional Queensland will be a marathon, not a sprint," she said.
The deluge has ruined crops, closed most of the state's coal mines and caused "catastrophic" damage to Queensland's transport systems, Ms Bligh told Australian broadcaster ABC.
SnakesIn Rockhampton, more than 100 people spent the night in an emergency evacuation centre.
City Mayor Brad Carter said the waters were expected to remain at their peak level for about two days.
"Then as it starts to drop and flatten out, it is likely to be about 10 days or so that it could stay at about the 8.5m mark, which indicates that we will have significant water inundation for the best part of... two weeks," he said.
Many of the city's historic buildings are being protected by piles of sandbags.
The city's main road to the north is still open but the airport is closed. Supplies are being flown by military cargo plane to a town north of Rockhampton and taken on by road or barge.
Mr Carter said residents had reported seeing snakes moving through the water looking for dry ground and some saltwater crocodiles had also been spotted in the Fitzroy River.
"We do not think they are a risk to public safety if people keep out of the waters, but if people do enter the waters their safety cannot be guaranteed," he told The Australian newspaper.
More than a week of heavy rain has created a huge inland sea across Queensland which is now draining towards the ocean along the state's river systems, causing chaos in its wake.
Officials have said the flooded area is the size of France and Germany combined and 200,000 people have been affected. At least three deaths have been blamed on the floods so far.
South of Rockhampton, floodwaters are threatening St George where officials predict 80% of the town could be inundated next week.
To make matters worse, more rain is forecast for the state.
On Wednesday meteorologists issued a severe thunderstorm warning for southern areas, saying "very heavy rainfall, flash flooding" were likely, with St George among the locations that could be affected.
Queensland Emergency Services Minister Neil Roberts said the cost of the flood damage would run into "billions and billions of dollars".
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