Eight people died and scores were missing on Tuesday after giant flash floods smashed through an Australian town like an "inland tsunami", dramatically escalating a widespread flood crisis.

Officials said the death toll was expected to rise after fast-running torrents of water devastated the rural town of Toowoomba and other nearby areas, sweeping away cars and leaving survivors clinging to trees.

"These are shocking and heartbreaking circumstances involving young families and young children in a very rapidly unfolding situation," Queensland state premier Anna Bligh said.

TV images showed streets turned into churning rapids dotted with floating cars, some with people sitting on top, while elsewhere residents were forced on top of buildings as water-levels reached their roofs.

A woman and two children were found dead in Toowoomba city centre, which lies 125 kilometres (80 miles) west of the state capital, Brisbane, while a man and a boy were killed at nearby Murphys Creek, officials said.

Disaster coordinator Ian Stewart said rescue teams were searching for 72 people reported missing, adding that he had serious concerns about the township of Grantham, where dozens of people are stranded.

"Grantham is going to be, in my view, just a disaster in terms of the number of homes that have been damaged or destroyed and we're waiting on confirmation of potential extra loss of life," Stewart said.

The flash floods were caused by torrential rains falling on Australia's flood-stricken northeast, where overflowing rivers have afflicted a huge area the size of France and Germany combined at huge economic cost.

Federal MP Ian MacFarlane described dramatic scenes in Toowoomba as the flash flood deluged the town before subsiding within three hours, leaving scenes of destruction and people dead in their cars.

"We're just seeing building after building, the water rushing in and blowing the windows out," MacFarlane told Sky News. "Cars that were parked in the carparks were just lifted up and went bobbing down the street."

"I've lived in Toowoomba for 20 years and I've never seen anything like that. This is flooding without precedent in Toowoomba," he added.

Helicopter rescue teams sent to search for the missing in the Lockyer Valley region were hampered by further heavy rains on Tuesday.

"This has been a terrible day, a terrible day," said police commissioner Bob Atkinson.

"Early reports would indicate that what hit Toowoomba could best be described as an inland instant tsunami, with a massive wall of water that's gone down through the Lockyer Valley."

Bligh called the waters "a freak of nature" and said Queensland was facing its "darkest hour".

"This is going to be I think a very grim day, particularly for the people in that region, and a desperate hour here in Queensland," she said.

"Mother Nature has unleashed something shocking on the Toowoomba region," Bligh said earlier. "This is without a doubt our darkest hour of the last fortnight."