Fears of a lake overflowing in Tibet and flooding an Indian state remain high as it is still raining in the region, Chinese officials say.
Authorities in the northern Indian state of Himachal Pradesh have already sounded a flood alert
Nearly 3,000 villagers living along the banks of the Sutlej river have been evacuated, according to reports.
Indian satellite images are said to show that the level of the Parechu lake in Tibet has risen.
"It is still raining in Tibet and water in the lake is going up. Our experts are on the spot closely studying the situation," Chinese Embassy spokesperson in Delhi, Yang Shuying, told BBC News Online.
The lake has been created by a landslide in the Parechu river in Tibet. It is located some 35km from the Indo-China border.
The Parechu, which drains into a tributary of the Sutlej river, has been blocked by a landslide since last July, Ms Yang said.
The blockage of the river has happened in Tibet's Ali Prefecture "that features high altitude, remoteness, difficult terrain, poor transportation and communication," said Ms Yang.
Any increase in rainfall and water flow from the upper reaches could result in "dam bursting or overflowing at any time".
Ms Yang said India is in continuous touch with China regarding developments in the area.
Indian army helicopters have conducted aerial surveys in Himachal Pradesh looking for any signs of flooding.
"Our rescue teams are ready with choppers and other equipment to meet any eventuality," a senior army official told Reuters.
Thousands of people have been evacuated from 50 villages that are likely to submerged if the lake overflows, a senior local official told Associated Press.
People living by the Sutlej are tense after the flood alert, some reports suggest.
"I have died a thousand deaths waiting for the floods, why doesn't it just come and end this suspense," a local hotelier Kirtan Chauhan told The Indian Express newspaper.
Parts of South Asia have suffered heavy flooding in the past month, leaving hundreds dead.
On Monday, emergency teams rescued 20 workers from a tunnel at Kullu to the north-west of the Sutlej.
The construction workers became trapped after a storm blocked the entrance to the tunnel.