Fire crews are working to pump water out of properties on the other side of the Clutha River from Alexandra town centre.
Water has run down Bodkin Road and Old Bridge Road as far as the river.
A witness told the Otago Daily Times he saw a geyser of water 40m high.
Another witness said the water had caved in a garage door and flooded a basement.
The main is believed to have burst around 3.30pm.