At least 150 people were evacuated from their homes, not counting campers and fishermen who use numerous roadside campgrounds, said Dennis Brodigan, Matanuska-Susitna Borough Emergency Services director.
A home and a cabin were destroyed in the flooding, while more than 100 houses were damaged, Brodigan said.
No injuries were reported, but a dive team was making evacuations and swift-water rescues, he said. One car with two men inside was swept down Montana Creek near Talkeetna, but the men managed to escape when the car brushed against the bank.
Rising water undermined two bridges on the Parks Highway, and the road could be closed for two days, officials said. Traffic between Anchorage and Fairbanks was diverted, adding about 75 miles to the 362-mile trip.
Twenty-five feet of a bridge that crosses Troublesome Creek about 225 miles south of Fairbanks were washed out, and the span had dropped by a foot, state officials said.
Nearly 7 inches of rain was recorded at Talkeetna, about 100 miles north of Anchorage, including 3.7 inches Friday, said Tom Dang of the National Weather Service.
Engineers were overseeing the passage over a bridge of about 500 tourists who had been staying at a remote hotel, the state Department of Transportation said. Messages left with DOT officials Saturday night seeking more information were not immediately returned.
Gov. Frank Murkowski was briefed on the damage Saturday during a visit to Wasilla, about 40 miles north of Anchorage. He had earlier issued a disaster declaration, allowing state funds to be used for recovery.
The Alaska Railroad suspended all freight and passenger traffic between Talkeetna and Denali National Park. The rail lines run roughly parallel to the Parks Highway.
A mudslide washed out 55 feet of track north of Talkeetna, railroad spokesman Tim Thompson said. Crews began repairs Saturday.
Steve Hicks of Willow, about 40 miles north of Anchorage, planned to spend Saturday night at a Red Cross shelter. "The Red Cross was Johnny on the Spot," he said.
More rain is in the forecast.