A privately owned dam on the edge of an Adelaide Hills town is at risk of collapse, with fears up to 40 homes could be flooded.

The State Emergency Service said people living in town of Echunga, south-east of Adelaide, should be prepared for at least ankle-deep water through their properties if the 10-megalitre structure failed – which is expected within the next day.

Concerns were first raised on Tuesday afternoon, with signs of “slippage” along the main wall.

Fears grew of a major collapse overnight, with an emergency warning put in place early on Wednesday and reaffirmed about noon.

Many residents evacuated to the Echunga Football Club or left town, while roads into the town were closed. The dam is on private land about 500 metres east of the town centre.

“A dam is failing in Echunga which will threaten you and your family’s safety,” the SES said in its latest warning issued at 11.30am.

“If you are in this area you should prepare for flooding.

“Move valuables to a safe place. Consider going soon to a safer place if the path is clear.”

The warning zone in the SA town of Echunga. Image: SA SES

The SES, SA police and SA Country Fire Service worked overnight to notify households under threat.

Those most at risk have been advised to leave with some gathering at the local football oval, away from the immediate danger zone.

About 30 to 40 properties could be “inundated with water” if the dam was to collapse, according to SES incident controller Craig Brassington.

“[The wall] is holding up at the moment … we’re expecting some slippage just because of the reducing of water and that side of things,” said on Wednesday afternoon, according to InDaily.

“There are still some people in the area, we’ll be doing another doorknock this afternoon just explaining the risk they are facing.”

Some residents have reportedly refused to leave.

“We just don’t want them to be there in case it does collapse and then that’s going to be a bigger issue for us,” Mr Bressington said.

An SES spokesman said pumps were being used to take water from the dam and levels had been reduced by about half a metre.

He said the water level needed to be cut by a further metre to make the area safe, something that could take another 24 hours.

“Worst-case scenario is the main wall of the dam gives way, allowing the water to come down into the town,” the spokesman said.

“We’re looking at about 30 to 40 properties that could be inundated with water.

“But at the moment it’s still holding.”

Officials were continuing to monitor the condition of the dam.

A sandbag collection point for local residents has been established at the Echunga CFS station.

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Among the properties directly in the firing line is Echunga blinds shop Complete Shutters Australia, about 270 metres directly east of the failing dam.

CEO Marc Boord told InDaily he had been clearing the property since receiving an evacuation warning at 5.20am and was told by authorities the dam could fail “within 30 minutes or it could be within three days”.

“They’re concerned about A, the volume of water, and B, the debris it could bring with it,” he said.

Premier Peter Malinauskas said he was briefed on the situation earlier in the day but described it as a “moving feast”.

The dam was last considered full in 2016 during heavy storms.

Recent heavy rains across the Adelaide Hills have caused major runoff, raising water levels.

-with agencies