AFP images from the town which sits on the border with Thailand showed people riding motorcycles through streets under red-brown waters and residents trying to bail out flooded shops and houses.
"Many people are stuck and my friends are stuck at their offices and cannot leave," Tachileik resident Phoo Phoo, 26, told AFP by phone.
Telephone and electricity lines in the town, home to at least 60,000 people were down, she said.
"Some houses are already under water. Ground floors and and motorcycles are submerged too."
Images shared on social media showed people sitting on their roof as the waters ran by below them.
Just over the border in the northern Thai district of Mae Sai, floodwaters were running through the streets, according to images published by local Thai media.
Thailand's weather office said more heavy to very heavy rains were likely in the north on Wednesday.
Last week at least 20 people went missing when the boat they were travelling in along the Mekong river, around 20 kilometres (12 miles) from Tachileik, met with a mishap, local officials said.
The rainy season typically brings months of heavy downpours to the Southeast Asian country, but scientists say man-made climate change is making weather patterns more intense.
