A 50km-wide inland sea is surging towards the Kimberley coast after the swollen Fitzroy River devastated the town of Fitzroy Crossing earlier in the week.
Emergency Services Minister Stephen Dawson warned residents they would become isolated by floodwaters.
"Be under no illusions, Derby will be an island in the next few days, it will be cut off," Mr Dawson told reporters on Friday.
"The weather and the water, it's coming towards it so there will be isolation for probably Broome and Derby.
"This is only starting and we've got days of this ahead of us."
The massive flood peak that reached a record 15.81m in Fitzroy Crossing late on Wednesday slammed into the tiny Indigenous community of Noonkanbah, 280km east Broome, on Friday.
"Water will be fast flowing and levels will rise quickly," Mr Dawson said.
"This emergency situation is still evolving. It's the worst flood disaster in our state's history."
Looma and Willare are also flooded, with dozens of others isolated, after seven-day rainfall totals up to 600mm were recorded across the region.
Emergency workers continue to rescue residents, as a massive operation involving the Australian Defence Force gets underway to ensure essential supplies reach cut-off communities and pastoral stations.
A 400km section of the Great Northern Highway south of Broome has been closed and a 500km part of the same freight route between Willare and Halls Creek remains shut.
Authorities say more ADF support may be needed and it could take weeks, if not months, for the only road transport link to the north of the state to reopen due to road and bridge damage.
The unprecedented flooding has been caused by ex-tropical cyclone Ellie, which on Friday afternoon was about 300km southeast of Broome.
The slow-moving weather system started moving southeast on Friday and is expected to move further inland towards the Northern Territory over the weekend and weaken.
People in the area are warned that isolated rainfall totals of up 60mm are possible as the system moves out of the region.
Meanwhile, major flooding continues in the western NSW town of Menindee, where the Darling River is expected to break the 1976 record of 10.47m in coming days.
The bureau expects the waterway to reach 10.5m but warns it could rise to 10.7m.