The storm, still powerful despite losing its tropical characterics, is creeping north and east along the Carolina coast, and is expected to strengthen after moving offshore into the Atlantic, possibly reaching near-hurricane intensity on Sunday, the National Hurricane Centre said.
Life-threatening storm surges are possible in the next 12 hours in the Hampton Roads, Virginia, area, the centre said.
At 11am (local time), the centre of the fourth named storm of the 2016 Atlantic hurricane season was just off the northern Outer Banks of North Carolina, with top winds strengthening slightly to near 100kmh, the hurricane centre said.
After heading east-northeast into the open ocean, the storm is expected to head north and be off the Middle Atlantic's Delmarva Peninsula Sunday night into Monday, it said.
"It's going to sit offshore and it is going to be a tremendous coastal event with a dangerous storm surge and lots of larger waves probably causing significant beach erosion, for the next few days," said Daniel Brown, senior hurricane specialist at the centre.
If they hit at high tide, storm surges could reach 1m -1.5m in the Hampton Roads in the next few hours, and over the next day and a half from Chincoteague, Virginia, to Sandy Hook, New Jersey, the centre said.
Powerful winds extended up to 335km from Hermine's centre, the NHC warned.
Labor Day weekend plans for vacationers headed to beaches along the Atlantic seaboard were dampened after the storm battered Florida's $89 billion tourism industry.
Officials in Atlantic City, New Jersey, canceled weekend concerts and beaches were closed in several communities.
North Carolina's Emergency Management office warned of strong rip currents, high seas and beach erosion as the storm moved through.
Hermine, the first hurricane to make landfall in Florida in 11 years, swept ashore early Friday near the Gulf shore town of St. Marks with winds of 80 mph (130 kph), churning up a devastating storm surge.
Authorities reported one storm-related death in the northern Florida town of Ocala, where a falling tree killed a homeless man sleeping in his tent.
FLOODS
Early on Saturday, crews in Wilmington, North Carolina, rescued several people sitting atop their vehicle in a flooded street, photos from local media showed. A tornado in North Carolina caused at least one injury, local media reported.
About 150,000 households were without power in Florida, Georgia and the Carolinas, utility companies reported Saturday.
Emergency declarations remained in effect for all or parts of Florida, Georgia, North Carolina, Virginia and Maryland.
The storm was projected to dump up to 18cm of rain in southeast Virginia and Atlantic coastal parts of Maryland and up to 10cm in southern Delaware, southern and eastern New Jersey and Long Island, Brown said.
New Jersey emergency officials advised residents to prepare for flooding, high winds and a surge of seawater.
New York Governor Andrew Cuomo on Friday activated his state's emergency operations center and ordered officials to stockpile resources, including sandbags and generators.
New York Mayor Bill De Blasio said residents should avoid beach waters for fear of life-threatening riptides.
Concerns over standing water in which mosquitoes breed intensified in Florida as it battled an outbreak of the Zika virus.
