It diminished from hurricane force as it came ashore, but forecasters said the 350-mile-wide storm's slow progress across North and South Carolina could leave much of the region under water in the coming days.
In New Bern, North Carolina, the storm surge overwhelmed the town of 30,000 which is located at the confluence of the Neuse and Trent rivers.
Officials in New Bern, which dates to the early 18th century, said more than 100 people were rescued from floods and the downtown was under water by Friday afternoon.
Florence was a Category 3 hurricane on the five-step Saffir-Simpson scale with 120-mph winds on Thursday. It was downgraded to a Category 1 hurricane before coming ashore near Wrightsville Beach close to Wilmington, North Carolina.
The National Hurricane Center (NHC) downgraded it to a tropical storm on Friday, but warned it would dump as much as 30 to 40 inches (76-102 cm) of rain on the southeastern coast of North Carolina and part of northeastern South Carolina.
About 10 million people could be affected by the storm.
More than 22,600 people were housed in 150 shelters statewide, including schools, churches and Wake Forest University’s basketball arena.
"This rainfall will produce catastrophic flash flooding and prolonged, significant river flooding," the hurricane center said.
Florence was moving west-southwest at about 5 mph (7 km/h), with its center located over eastern South Carolina. The storm is expected to turn west and then north moving through the Carolinas and the Ohio Valley by Monday, the NHC said early on Saturday.
The storm was expected to become a tropical depression on Saturday and significant weakening was expected over the weekend, the NHC said in a bulletin.
Florence was one of two major storms threatening millions of people on opposite sides of the world.