Nicholas was located approximately 15 miles south-southwest of Houston on Tuesday morning, moving toward the north-northeast near 8 mph.
The National Hurricane Center warned that Nicholas could cause life-threatening flash flooding across the Deep South over the next couple of days, and at 7 a.m. CT it had maximum sustained winds of 60 mph with higher gusts.
Tropical storm-force winds extend outward up to 125 miles from the storm's center.
Nicholas is projected to move slowly to the northeast and then eastward over Louisiana by Wednesday.
"Little motion is anticipated on Thursday," the hurricane center wrote in a Facebook post.
Nicholas is forecast to become a tropical depression by Wednesday, however tropical storm conditions are anticipated across Texas coasts through Tuesday and along the Louisiana coast by later this morning.
"A tornado or two" will also be possible through Tuesday along the upper Texas Coast and southern Louisiana.
A storm surge warning is in effect for San Luis Pass to Sabine Pass, including Galveston Bay; a tropical storm warning is in effect for San Luis Pass, Texas to Cameron, Louisiana; and a storm surge watch is in effect for Sabine Pass to Rutherford Beach, Louisiana.
A combination of a dangerous storm surge and the tide – impacted by the tropical storm – is predicted to cause normally dry coastal areas to be flooding with 3-5 feet from Sargent, Texas, to High Island and Galveston Bay.
Isolated storm totals of 20 inches are likely across central to southern Louisiana.
"Life-threatening flash flooding impacts, especially in urbanized metropolitan areas, are possible across these regions. Widespread minor to isolated major river flooding is expected across portions of the upper Texas Gulf Coast and southern Louisiana and Mississippi," the hurricane center wrote.
Texas Gov. Greg Abbott said authorities have placed rescue teams and resources in the Houston area and along the coast and Houston Mayor Sylvester Turner said high-water rescue vehicles had been deployed and barricades had been set up throughout the city.
"This city is very resilient. We know what we need to do. We know about preparing," he said, referencing four major flood events that have hit the Houston area in recent years.
Numerous school districts along the Texas Gulf Coast canceled classes on Monday and Tuesday and multiple COVID-19 testing and vaccination sites in the Houston and Corpus Christi areas were forced to close.
A Monday night concert for pop star and boyband sensation Harry Styles was also canceled.
Louisiana Gov. John Bel Edwards declared a state of emergency Sunday night.
"The most severe threat to Louisiana is in the southwest portion of the state, where recovery from Hurricane Laura and the May flooding is ongoing," Edwards said.
Nicholas was the 14th named storm of the 2021 Atlantic hurricane season.
Elsewhere over the Atlantic basin, the hurricane center was monitoring a tropical wave and a well-defined low-pressure system located around 400 miles southeast of the southern Cabo Verde Islands.
The Associated Press contributed to this report.