A road has subsided and people have been asked to conserve tap water after a significant water main burst in Queenstown, causing flooding nearby.
Fire and Emergency were called to Fernhill Road shortly before 1:30pm on Monday, where there was flooding and debris on the road.
Fire crews used pumps and worked to clear the water and salvage anything that could be damaged by the flood.
Water had also gone into the basement at the Heritage Hotel.
In an update at 3pm, Queenstown Lakes District Council said the flow from the water main had been temporarily stopped, but more work was needed to fix the problem.
"A significant amount of water flowed down the road before council contractors joined police and fire emergency services on site and isolated the break," the statement said.
"Local residents should conserve their water wherever possible while the fix is underway."
Drivers were asked to avoid the area, and a detour was available via Sunshine Bay.
"Whilst this has stopped the flow of water, cold temperatures could cause remaining water on the road surface to freeze causing a further hazard for drivers," the council said.
"The road will remain closed while we investigate the cause, design a repair and make it safe."
As well as the damage on Fernhill Road, there had been a slip on the Glenorchy-Queenstown Road, where traffic was down to one lane.