The Three Gorges dam on China's longest river, the Yangtze, is standing up to its biggest flood control test since completion last year, officials say.
Floodwaters in the giant reservoir rose 4m (13ft) overnight, and are now just 20m below the dam's maximum capacity.
The authorities are using the dam to limit the amount of water flowing further downstream to try to minimise the impact of devastating floods.
Beijing cited flood control as a main reason for the $27.2bn (£16.7bn) dam.
Hundreds of people have died in central and southern China in the country's worst floods in more than a decade.
The Three Gorges dam, the largest in the world, was a controversial project as it forced the relocation of 1.4 million people. It is situated in Hubei province.
The flow of the water overnight was the fastest ever recorded, at 70,000 cubic metres per second.
Dr Cao Guangjing, head of China Three Gorges Corporation, told the BBC that 40,000 cubic metres/second were released, with 30,000 cubic metres/second of water held back in the reservoir.
"Without the Three Gorges this kind of discharge would bring disaster to the downstream areas," he said.
The BBC's Damian Grammaticas, who is upstream in Guang'an, Sichuan province, says shops there are submerged, and people are waiting to ferry supplies by boat to relatives trapped in their homes.
Teams of Chinese soldiers are manning rescue boats, he says.
Meanwhile, at least 11 people were missing after a landslide caused by torrential rains hit a village in Mianning country in Sichuan province, state media reported.
Sichuan and neighbouring Shaanxi province have been hard hit by a series of landslides in recent days, that have killed 37 people and left nearly 100 missing, Xinhua reported.
More than 35 million people across China have been affected by the poor weather and 1.2 million have been relocated.
China is facing its worst floods since 1998, when more than 4,000 people died, and 18 million people were displaced, the China Daily newspaper said.