The southern Australian town of Horsham has been split in two by water and at least one young boy is feared drowned.
Rains which had laid waste to Queensland are now threatening the state of Victoria where flood waters continue to rise.
Prime Minister Julia Gillard said she had formed a panel of corporate leaders to support recovery.
The floods have been described as Australia's most expensive natural disaster.
"We know many communities are anxiously waiting as floodwaters rise and many townships across Victoria have already been impacted by floodwaters," Ms Gillard said.
"We also know that a small boy is missing, and so these are very difficult times in Victoria."
Sandbags
An eight-year-old boy disappeared in a flooded waterhole near the town of Shepparton on Monday morning and has not been found.
Electricity cuts have occurred as power stations have been flooded. More than 3,500 people have evacuated their homes in the north central part of the state.
Sandbags have been stacked up to try to withstand the waters, which are expected to peak later on Tuesday.
"You can't control nature totally, but I think to the extent we had about three or four days' warning and we have an experienced emergency team, I think we're going as well as we can," Horsham Mayor Michael Ryan said.
Another official in Horsham, David Eltringham, said the town was expecting "a one-in-a-100-year flood".
"We are expecting to see the peak maximum flood levels today and inundation will come with that," an emergency services spokeswoman said.
"Significant inundation of properties is currently being experienced with water up to 1m (3ft) deep in some areas."
'Most expensive'
Further north, at least 30 people died in floods in Queensland. Ten people are still missing, and recovery efforts are proving slow and gruesome.
The government has also warned that the floods in Queensland could be the country's most expensive natural disaster ever.
Ms Gillard said the country needed private industry to help the recovery and reconstruction effort.
"I've decided to bring together 10 Australian leading business people to form a business round-table to assist with corporate support, as Queensland recovers and rebuilds from these devastating floods," she said.
Anna Bligh, Premier of Queensland, said her state needed "business and corporate Australia standing with us" and "community members doing what they're doing out there with mops and buckets, digging into their pockets and putting some money into the relief appeal."
Ms Bligh announced an inquiry into the flooding that would look at issues including the operation of dams and would serve as an investment in the state's future.
