More than 150 people had been removed from the possible path of dam waters, Luann Hunt, a spokesperson for the city of Lynchburg, told ABC News.
A deluge of rain in Virginia has prompted evacuations below an overflowing dam.
"We are still concerned about its overall stability going into tonight and tomorrow morning", said Tim Mitchell, the director of Lynchburg Water Resources.
If the dam fails completely, 17ft (5m) of water could flood it in seven minutes, the National Water Service said.
A dam in Lynchburg could be on the verge of breaching putting the whole city at risk of drowning under 17 feet (5m) of water in as little as 7 minutes.
Because the sediment from the city's runoff is trapped above the dam, the lake has dramatically reduced in size.
College Lake sits adjacent to the University of Lynchburg, and the dam was built in 1934 by the Virginia Department of Highways.
The weather service issued a flash flood watch in effect until 6pm Friday, as additional showers and thunderstorms with heavy rain are possible.
Engineers have been assessing the situation at College Lake Dam.
Water damage restoration and cleaning services have reported being inundated with calls for help from Lynchburg and surrounding area residents who have already returned to their homes.
The dam doesn't meet current regulations and the city is making it a priority to find a solution.
The dam was built in the 1930s by the Virginia Department of Highways and is now listed among "high hazard dams" in need of fix in Virginia.
The city of Lynchburg is the closest settlement downstream of the structure. But the crew monitoring the dam last night raised concerns about structural integrity after just about six inches of rain. More recent projections have placed the fix costs at $10 million.
He said that they were now focused on evacuations and road closures near and around the dam, warning that more could be on the way.