Timaru District Council says it is negotiating conditional re-entry to residents evacuated due to a flooding risk from the Ōpihi River.
Work is underway to reinforce the compromised stopbank.
It is expected to take a few days to complete and the state of emergency will remain in place until then.
The council said residents in the Mill Road community would be able to return to their homes after 5pm under strict conditions.
"An early warning system has been implemented in the event of an increased flow of anything in advance of 50 cumecs," the council said.
"With substantial rainfall anticipated mid-way through next week, the lower alarm will provide a three-hour advance notice in the event that an evacuation is required for work crews and residents."
Access to the area will only be open to residents and contract vehicles working on the stopbank.
"Residents have been instructed to stay clear of the stopbanks and works, and to be prepared to re-evacuate if the lower alarms are raised, or they are advised by local authorities."