Forbes Mayor Phyllis Miller says she thinks "we’re as well prepared as you possibly can be" for a major flood.
"We’ve been preparing for a flood for, I would suggest, the last month," Ms Miller told Sky News Australia.
Residents of roughly 800 homes in Forbes, in the Central West of New South Wales, have been warned to prepare for a possible evacuation.
Preparations are taking place in the town, with a major sandbagging operation being seen.
It comes as a major flood peak is due to arrive in the town on the Lachlan River.